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October 7, 1908 DOCUMENTS 

OCT 15 1969 



The Honorable 

The Board of Supervisor! 

Room 235, City Hall 

San Francls^co., California 

Gentlemen •. 

Section 25 of the- Charter requires that, at your first meeting 
in October, the Mayor "communicate by message to the Su' L i ■■■. s a 
general statement of the condition of the affairs of the City and 
County, and recommend the adoption of such measures as he may deem 
expedient and proper," I am pleased to do so. 

This Board and I have been in office now for a period of nine- 
months. Both the Board and I have maintained the in' nee of judg- 
ment required by the Charter. From this, separate but equal relationship 
has developed a e-plendid collaboration, for which I am appreciative, to 
get this beautiful City moving in the direction of increased greatness. 
1 appreciate the co-equal and resourceful contribution which has been 
male by this Honorable Board and I cherish the opportunity I have had 
to know and work with each of you. Together, we have made a beginning — 
but only a beginning -- toward organizing the City to solve agonizing 
problems and mobilizing to enhance the lustre of what is universally 
recognized as one of the world's great and vital communities. 

In my inauguration as Mayor, just fleeting months ago, I asked 
San Franciscans: "Come join with me in a grand urban coalition, involve 
yourself deeply with me in a relentless effort to ignite a flame in the 
breast of this City, a fiery spirit of adventure that soars beyond the 
ordinary, beyond the complacent, beyond the mediocre, into the heights 
of the excellent, the daring and the imaginative. ,: 

That exhortation continues undiminished today. So much remains 
undone. So many tasks unfinished. So many problems unfathomed -- 
particularly the tragic specter of the alienated young and their reliance 
on the dangerous artificiality of drugs. Fear is not uncommon in San 
Francisco. Nor is f lustration, whether it stems from dissatisfaction 
over higher taxes or with the tempo of social change. 

San Francisco, throughout her long history, has never been a 
City of complacency or self-satisfaction. The City always has sought 

3 1223 03273 0161 

new horizons. Today, the realization burns with increasing intensity 
that San Francisco is; one City in the Unit tes that, in bhe 
reasonable future, can overcome many of the problems that loom so lai 
over our land. 

We have made the point with Federal officials, Foundation 
managers and others that San Francisco has as good a chance as any big 
city to put behind it the contemporary problem of the urban crisis; 
and that, therefore, they should join with us in a concert of action 
to demonstrate that the plight of the cities is not hopeless, but that 
the great centers of this nation can be saved. 

Rising crime can be checked, of this I am confident. Taxes 
can be set in order and made equitable. Jobs can be found; homes built; 
education improved, and the quality of life made rich with opportunity 
for all San Franciscans. The gulf that now separates the needy and the 
despairing from the limitless promises of our society and democracy can 
be bridged. 

These achievements will flow naturally if San Francisco con- 
tinues to enlarge her atmosphere of investment, which brings private 
enterprise dollars, foundation funds and Federal grants into this City. 
This confluence of enterprise is strengthened by an intricate and 
progressive relationship that as construction booms, jobs open, the tax 
base broadens and -- as it must -- shifts more from homes to income 
commercial property. 

Already, the steel skeletons of more than $1 billion in planned 
construction stand against the skyline. Airlines plan construction in 
the millions of dollars and new employment for thousands at San Francisco 
International Airport. Abandoned buildings have been converted to 
thriving community centers in Hunters Point and the Mission District. 
Vacant fields are being transformed to mini-parks. Film companies have 
been attracted here and have contributed to a swimming pool that attracts 
hundreds of Bayview youngsters daily. Voters approved bonds for $24 
million to improve Market Street. 

One of the great, once-in-a-lifetime opportunities for San 
Francisco to direct her destiny will be the transfer of the Port from 
State to City control. This is a measure that I ranked among the top 
priorities of my administration. The Legislature and the Governor 
approved the transfer, and San Franciscans, I am sure, will ratify the 
enabling legislation - Propositions B and C - in the November election. 

The transfer will permit the City to marshal its energies and 
its intellect behind development of one of the most majestic sweeps of 
waterfront anywhere in the world. The potentials are limitless ... 
residences, recreation facilities, shops, and restaurants built over 

2 50334 SFPL: ECONO JRS 
126 SFPL 09/26/03 

The Honorable 

The Board of Supervisors - 3 - October 7, 1968 

the water and fully integrated with the development of the entire 
Embarcadero area. The maritime facilities can be modernized and made 
the best, and new life can surge through our now empty and forlorn pj 

Frankly, I discount those Cassandras who see San Francisco 
losing her glamor and who picture her as run-down at the heels and sick 
with prejudice and crime. I firmly believe San Francisco still retails 
her old confidence in herself. She is troubled and she is dissatisfy 
but, as always, she welcomes the future in the firm belief that each 
day offers an opportunity for solid progress. 

This level of hope radiates into every neighborhood of the City 
and has helped keep this City cool while more than 100 American cities 
flamed with riots. 

This" thankful situation is precious proof that this City can 
make progress against the social evils that create tension and disorder. 
It also testifies to the Cityis tradition of civility and moderation. 
Reason and restraint have made possible the closing of the gap between 
races within the next ten years. Policies have been deliberately pursued 
to this end: 

* Opening all possible lines of communication to ghetto groups, 
particularly the young and the militant. "Be militant', but never 
violent," they have been told. :: Come to us before you go to the street 
with your problems," So far, they have. City Hall is open to all 
groups with legitimate demands, and frequent meetings have been held in 
homes, churches, schools and community centers in neglected neighborhoods. 
That policy will be continued. 

* Opening all possible job opportunities. The number of summer 
jobs more than doubled over the previous year -- more than 8,000 -- and 
a program has been launched for more than 3,000 permanent jobs for the 
so-called hard-core unemployed. Additionally, airlines promised to hire 
thousands more in extensive expansion at San Francisco International 
Airport and enlightened labor unions, in an historic event, agreed to 
break down old barriers and signed an agreement to recruit and train 
minority young men and women. City government, in its I'ole of employer, 
while assiduously maintaining high Civil Service standards, has made a 
conscious effort to hire minorities. 

* Pushing new housing programs so that all San Franciscans can 
have a decent home. These include acquiring unused Federal lands for 
housing development after full public hearing and strict planning 
requirements; a referendum for 3,000 additional units of public housing 
for the elderly and for large families; a relocation service in the 
Mayor's office to insure proper housing for persons displaced by 
redevelopment; approval by the Board of Supervisors of the nation's first 
local rent supplement program; active citizen participation in proposed 

The Honorable 

The Board of Supervisors - 4 - October 7, L968 

redevelopment of Hunters Point and in the Western Addition; the appr - 
by the Department of Housing and Urban Development of Model Cities 
program for Hunters Point and the Mission District; and the promotion 
of the $1 billion dollars in major downtown construction. 

* Supporting programs . for improving the quality of education 
in the ghettos and throughout San Francisco, A step in this direction 
was my appointment of a 29-year-old former ghetto teacher, David Sanchez, 
to the Board of Education. 

* Encouraging increased involvement by minority communities 
in city government. In addition to the appointment of Mr. Sanchez to 
the Board of Education, 1 appointed the first Black to the Police 
Commission, and the first Black and first member of the Spanish-speaking 
community ever to serve on a Mayor's cabinet. Others from minority 
communities have, for the first time, been appointed to committees and 
boards, and a significant beginning has been made on programs to develop 
more minority entrepreneurs in our ghettos. 

To develop these and other social programs, the Mayor's office 
has added a director and an assistant to work with youth and shortly 
will establish a staff to work exclusively with senior citizens. Both 
programs receive Federal funds. 

For the first time, a Federal-local task force of representatives 
of major Federal agencies and city departments has been organized to 
review the City's needs and expedite grants and locate necessary funds 
for unmet priorities. (Some $15 million in Federal grants have been 
received by the City so far this year.) One area of essential coopera- 
tion between Federal and City officials is Chinatown. Recent changes 
in immigration laws are bringing increasing numbers of Chinese into San 
Francisco. They, of course, are welcome. They bring with them a rich 
heritage and. the great courage pioneers inevitably bring to a new 
frontier. Many are staying, placing increased burdens on our Health 
Department, our educational facilities and many other City operations. 
Obviously, costs should be shared by the Federal government. 

Beyond these specific and immediate efforts is a far-reaching 
step that will permit City government to deal more effectively with 
the challenges of the latter half of the Twentieth Century. It is 
revision of the City's 36-year-old Charter. 

Twenty-one members have been appointed to the Charter Revision 
Committee by me and your Honorable Eoard. The committee is funded and 
has started hearings that should lead to significant improvements in 
making our government fully responsible to the public will. The first 
proposals should be ready for submission to the electorate in November, 

The Board of Supervisors - 5 - October 7, 

All these efforts are directed to one aim of making this a 
harmonious and stable City in which all San Franciscans can find fulfill- 
ment. There is a terrible malaise of mediocrity infecting the 
bureaucracies of many of the nation's larger cities, and it must be 
comhatted continuously if it is not to disease the vision and the vitality 
of San Francisco. 

San Francisco must clearly and calmly recognize the virus of 
decline and defeat that threatens her. Let us examine, one by one, the 
aches of her deeper problems, and affirmatively and specifically, suggest 
how the City can mobilize to overcome them: 


Crime rates go up, but so does the effectiveness of the Police 
Deportment. It is one of the finest in the nation, and it now has more 
men on active patrol on the streets than ever before in San Francisco's 
history. Cadets have been employed to free patrolmen for street duty. 
The department's Community Relations Unit has been expanded and placed 
under a respected lieutenant, known for his work in improving race 
relations. The Tactical Squad, only a few months old, was reorganized 
to rotate members and to put a lieutenant in charge. "Saturation 1 ' 
squads of plainclothesmen operate diligently in the Tenderloin, the 
Haight-Ashbury and other troubled neighborhoods. 

Arrests have increased under this intense surveillance, and I 
have made clear to police that 1 expect vigilant and vigorous enforcement 
within Constitutional limitations. Diligent enforcement is but one of 
three indispensable co-equals to good law enforcement. The others are 
rigorous community relations and an unrelenting war on social injustice. 

Always, the City must require the highest possible professio, 
standards among police. The department itself must continuously seek 
out ways to improve its communication, its mobility, and its command 
procedures to insure that officers mobilize in the fewest possible 
minutes at points of violence or disorder. Training must be vigorous to 
instill dedication and discipline; and recruitment must be impartial as 
to race, and intense in its quest for men of balance and judgment. As 
an incentive to quality applicants, I propose the department institute 
premium pay for night work and for dangerous duty. 

To come forcefully to grips with the challenging problems of 
law enforcement, and to insure all San Franciscans their safety and their 
freedoms, the Mayor's office and your Honorable Board early established 
a Committee on Crime. It is now hard at work on such complex and 
sensitive issues as civil disorder, prostitution, homosexuality, court 
procedures, parole and rehabilitation. 

The Honorable 

The Hoard of Supervisors - 6 - October 7, 1908 

San Franciscans have worked conscientiously toward improved 
law enforcement. They have stood behind the police in the face of 
incredible provocation. Witnesses have helped apprehend felons. 
Hundreds have worked with the Community Relations Unit in Lng the 
sting of tensions from many neighborhoods. Furthermore, San Franciscans, 
in an event unequaled in the United States, turned in more than 2,000 
guns in a month-long campaign which I intend to make a yearly event. 

Concurrently, your Honorable Board enacted a thoroughly 
sensible gun registration law, which will be upheld in the courts and 
which can become a pattern for oilier cities. 


Enactment of the gun registration Law emphasizes my conviction 
that we ought to feel free to act by legislation in areas which, up to 
now, may have been deemed closed to us. The Constitutional doctrine 
that cities may not legislate in areas where the State or Federal 
government "has occupied the field" is not an absolute lav?. Instead, 
the doctrine is relative to social circumstances, which should be 
constantly examined to determine which government should act, I think 
it clear that the constitutional focus is moving closer to the cities 
in terms of expanded legislative power. It is commonplace to assert I 
that the basic problem of our times is the crisis of the inner city. 
The social facts have evolved in that direction. We must also consider 
that the state and federal legislatures are composed of non-city as 
well as city representatives. The requirement that laws be universal 
over a given class of persons or things tends to limit the power or 
willingness to act by state and federal legislatures on matters that 
are exclusively eity-oriented. 

Hence, I strongly urge that your Honorable Board should not be 
deterred from acting on our own city problems - whether they relate to 
weapon control, taxes, civil disorder, pcrrnography, control of some 
city-oriented drugs, disruption of meetings or other concerns peculiar 
to cities as cities - by doubts, however grave, that some other 
legislature "has occupied or preempted the field." This should be so, 
particularly if that "other legislature" exhibits an inordinate dis- 
position to substitute talk for action or where there is sufficient 
basis to believe that the subject matter is controlled by economic 
influences with a demonstrated capacity to stifle or emasculate needed 

This is but one way of saying that the cities must look to 
their own legislative powers on problems that are peculiar to them and 
leave to the courts the unpredictable business of determining who has 
or has not "occupied the field," to what extent and wherein joint 
action is deemed complementary rather than contradictory. This is a 

/ j. en.* j. tr 

The Board of Supervisor's - 7 - October 7, 19&0 

nebulous area of the law .at best. We si I resolve doubts in favor of 
our power to act rather th3n in favor of our disability to act. 


Drug abuse, particularly among young people, is an area of 
menacing concern, not only to the Committee on Crime but to all San 
Francisco, and it calls for special and dramatic action. San Francisco 
is a focal point of the drug problem because it is here that many young 
people gather in what candidly must be recognized as disaffection from 

The plight of derelict youngsters, hooked on drugs, tragically 
cries for action on two fronts: 

1. A detailed and demanding inquiry as to why so many young 
people turn to drugs. This must be an open and reasoned search for 
hard answers — hard to find and probably hard to face. The widespread 
use of marijuana and other lighter hallucinogenics by young and old 
alike poses problems of lav.' enforcement not too dissimilar from those 
encountered during the Prohibition era in America. 

2. New ways must be explored for treating persons who already 
have plunged into the world of drugs. Medical and community service 
organizations must be mobilized. Treatment centers, private and public, 
must be made available, and rehabilitation methods that eliminate 
expensive hospital care developed. Foundation funds must be enlisted 
in this imperative effort. 

San Francisco, I am confident, can determine the causes and 
attack the results of drug abuse in an orderly, systematic and humane 
manner. At present, establishment of three neighborhood drug-abuse 
centers is before the Health Committee of your Honorable Board. 


There is no greater need, if San Francisco is to hold her 
homeowners, than to apply further rein on the property tax. A rollback 
in the form of non-property taxes has begun to provide relief from the 
increasing burdens of this antiquated tax. A gross receipts tax was 
enacted that" will bring in some $18 million a year, without which some 
■42 cents would have been added to the tax rate. The commuter tax will 
save an additional 30 cents when it goes into effect on January 1, 1969. 
More than $1.00 of this year's increase in the tax rate of $1.43 to 
$10.23 came from needs for school, welfare, Bay Area Rapid Transit and 
other matters over which neither I nor the Board of Supervisors have 
control. All are for vital services, and show clearly what I said 
during my election campaign last year that the services essential to a 
well-managed city cannot be reduced, but that revenue other than 
property tax must be found. 

The Honorable 

The Board of Supervisors - 3 - October 7, 1963 

The State Legislature has put a Constitutional amendment 

(Proposition 1-A) for property tax relief on the November ballot, It 
will establish a homeowners' property tax Lon, and further states 
that the Legislature shall provide a subvention to local government 
equal to the exemption. The measure also will provide for the exemption 
of household furnishings and personal effects and IS per cent oj: the 
value of business inventories from property taxation. 

Further state-wide effort will be needed to broaden taxes so 
that the full burden of increased costs of providing effective services 
won't fall solely on property taxes. Additionally, regional approaches 
to taxing must be developed, so that the entire Bay Area may pool 
resources on matters of mutual concern. An ultimate priority is for 
reform that will relate taxes to ability to pay. 


In San Francisco, I have put into effect fiscal controls over 
what will be the first full budget drawn up under my administration. 
This overhaul, a radical departure from past practice, will insure that 
every dollar is spent wisely on obvious city needs and that every 
possible source of Federal and State financial assistance will be tapped. 
This program, which requires a thorough definition of goals and a 
systematic description of the inter-relationship between various depart- 
ments, eliminates costly overlap and provides foi 1 the detailed information 
en which sound judgments can be made. I believe this orderly analysis 
will enable almost all of our departments to cut their budgets two to 
five per cent — a substantial saving to San Francisco taxpayers. If 
they do not, I shall not hesitate to achieve this result by scientific 
and discriminating methods, if po-sible; by any method, if necesssary. 


Deterioration of some San Francisco neighborhoods has gone toe 
far, and the City must adopt a creative and bold program of "Neighborhood 
Conservation." Redevelopment and Code Enforcement are vital programs 
to remedy decay and to prevent the bulldozing of buildings by facilitating 
rehabilitation to modern standards. "Neighborhood Conservation' 7 will 
provide for the orderly prevention of blight through concerted neighbor- 
hood action. 

As part of this, I shall shortly recommend that your Honorable 
Board create a Community Council, made up of representatives of neighbor- 
hood groups and professionally staffed, to review the entire range of 
neighborhood needs and assess priorities. 

Additionally, efforts must be made to lower building costs to 
put home ownership within reach of more San Franciscans. These incli 

The Honorable 

The Board of Supervisors - 9 - October 7, 1968 

realistic zoning standards, a review of construction methods which 
inhibit efficiency in using mass production techniques and modernization 
of codes. 

Already j the City has taken aggressive action to help ease 
her housing problems. The most significant was approval of the f 
broad program of rent assistance for persons displaced by redevelopment 
or other governmental action. Other actions include authorization for 
a special assistant for housing and relocation in the Mayor's office; 
the acquisition of Midtown Park Apartments; the approval of three 
additional Code Enforcement az'eas; the recertification of Snn Francisco's 
Workable Program for Community Action; approval of Model Cities applica- 
tions in Hunters Point and the Mission District; and authorization for 
the appointment of a Mayor's Housing Committee. 

Additionally, your Honorable Board has made possible a review 
of land uses at three magnificent* Federal forts — Funston, Miiey and 
Mason -- for possible residential and recreational development. 

The Housing Authority has made significant strides and won a 
major breakthrough in securing special Federal funds for the rehabilita- 
tion of older public housing projects. Furthermore, it has submitted 
for the November ballot a measure to authorize the construction of 
3,000 additional units for the elderly and large families. 


In many v;ays, the embodiment of San Francisco's hopeful sense 
of renaissance and rejuvenation is boldly cultivated by the Redevelop 
Agency in its constant effort to involve San Franciscans in the improve- 
ment of their neighborhoods. The agency continues to concentrate on 
providing homes at the lowest possible cost. Priority has been given to 
non-profit sponsors. Under this type of program, land costs are reduced 
and long-term mortgages arranged so that substantially lower rents are 

In the Western Addition A-2, ground was broken for the first of 
many such projects — Martin Luther King Square. The project will be 
built, owned and manged by the community and for the community. 

The Redevelopment Agency also has pioneered the development of 
centers unique in the world — the completion of the Japanese-American 
Cultural Center, and announcing plans for an equally magnificent Chinese 
Cultural Center. There are preliminary plans, within the scope of 
achievement, for Italian-American, Spanish-American, and Black-American 
cultural and commercial centers. 

The Honorable 

The Board of Supervisors - 10 - October 7, 1968 


The wheezing decrepitude of so much of this City's Municipal 
Railway System is in need of replacement, and a non-profit corporation 
has been created to purchase some $51 million in new vehicles. Beyoi 
the immediate imperative of securing new rolling stock is the long-range 
necessity of developing a comprehensive, over-all transportation policy 
for the City. I will call on your Honorable Board to assist me in 
pulling together, into a continuing and dynamic working relationship, 
all those separate transportation efforts now being made by different 
departments and agencies. This unity will forge a coordinated and 
concerted program for improving the City's transportation network. 

To improve safety to drivers and passengers on the Muni, 
two-way radios will be installed on many buses. 

Still unresolved is the major and critical necessity of financing 
the deficit of the Bay Area Rapid Transit System. The system itself is 
one of the world's transportation marvels, but the State government has 
yet to listen to the officials of the three counties in the district that 
a formula combining several financing methods will be acceptable. 
Surely, the State must act early in the next session of the Legislature, 
and I am sure that with the leadership of the San Francisco delegation, 
the Legislature will. 

The victory of San Francisco over the State Highway Commission 
in the matter of the Serra freeway should be noted. Our priceless 
watershed properties have been preserved for the best conservation; 
recreation and open-space uses. We are determined that the freeway 
mania will be subordinated to the claims of total urban beauty in San 
Francisco and that any discussions initiated by the State with respect- 
to further freeways in San Francisco must begin with the assumption 
that we will consider only underground thoroughfares. 


A thorough examination of our Department of Social Services is 
critically needed to determine how best to take advantage cf every 
Federal dollar and the most progressive programs. The goal' is to reduce 
dependency where possible and to provide effective and humane support 
where necessary, but to eliminate wherever possible those elements of 
programs which are degrading and of no positive value. Shortly, I will 
be seeking the assistance of local and national experts, as well as 
local concerned citizens, to develop a model social services program 
for the City. 


A construction contract was awarded this June for a Health 
Center for Chinatown-North Beach, and plans were pushed for establishing 

The Honorable 

The Board of Supervisors - 11 - October 7, 19GS 

mental health services in other neighborhood health centers. Plans for 
construction of a new General hospital were kept on a tight schedule, 
and the opening of the facility will be late 1972 or early 1973. 


San Francisco, from its beginning, has been a mecca for the 
intellectually adventurous and creative. This has given great spark and 
zest to the City, and has maintained her as one of the world's outstand- 
ing cultural and artistic leaders. Continued encouragement to the arts 
has been given through the establishment this year of Neighborhood Arts 
Councils to help develop young talent in music, drama, and the arts. 
More emphasis must be placed on the development of ethnic cultural 
activities by our talented minorities. 

The City is alive with music and art, but it is cramped for the 
presentation of larger performances. Our position as a center for the 
performing arts second only to New York must be maintained by early 
planning of a new Symphony Hall and rehearsal stage within practical 
financial limits. This will free the Opera House for an additional 100 
days, thus making possible expanded ballet and light opera seasons, as 
well as notable guest appearances. In San Francisco, the things of the 
mind and the spirit are matters of practical economic moment as well as 
manifestations of the deepest feelings of the human condition. 

We have within our group an opera company, a symphony, a 
ballet, a theatre company, an Oriental culture complex, and a chamber 
music organization, second to none in America. They represent sub- 
stantial regional assets which should be fostered to their highest 
development in expanding programs to reach the neighborhoods, the 
ghettos and the communities throughout the Bay Area. I regard a new 
building of about 2S00 seats to house a symphony hall and a rehearsal 
stage as an indispensable step to achieve this objective. 


As majestic as our City Hall is from the outside, it is little 
more than warrens of cramped and crowded offices inside. A new court 
house is needed, and plans are developing for locating it on the old 
Commerce High School parking lot. Tills will relieve pressures in City 
Hall and permit it to become solely an administrative and legislative 

Also needed is a new Main Library, and plans are well along to 
place befoi^e the voters in 1970 a bond issue for its construction. 

The Honorable 

The Board of Supervisors - 12 - October 7, 1968 

The list of efforts and programs can be endless. Many 
priorities press urgently for action. The need to develop idle or 
ill-used City lands, such as car bams and reservoirs is not the least. 

San Francisco, to reemphasize, is on the move, and there is 
great opportunity now to shape our institutions so that San Francisco 
can continue equal to the demands and challenges of our exciting times. 

There are so many possibilities, so many solid ideas "whose 
time has come" -- golf courses and the development of recreational 
facilities in the Crystal Springs watershed; the development of our 
water land in Pleasanton. 

This is a challenging City that fills the mind with ideas and 
the heart with unfailing confidence for the future. 

This City, as great as she is, could undergo a renaissance and 
be a symbol of hope and encouragement to all cities in the nation. She 
has a dedicated Board of Supervisors and splendid public officials. 
Greater coordination of our City departments remains an important goal, 
and through frequent cabinet meetings with me and through the orderly 
process of the budget controls I have imposed, I am confident this can 
be achieved. Certainly, the budget process alone will require agencies 
to define their goals and to identify means of integrating their efforts. 

San Francisco's history and momentum give it particular respon- 
sibilities for the development of the entire Bay Area as a true economic 
community with rich resources, urban beauty, and an unlimited potential 
for growth and progress. 

In order that this communication shall not be a generalized 
statement of things to be achieved in some unspecified future, I desire 
to set out some projects that will be begun or finished in the discernible 
period ahead of us, a period of 12 to 15 months. While these take on 
the appearance of physical things, it must be clearly remembered that our 
social programs and our social planning on housing, employment, quality 
education and dynamic recreation must be intertwined inextricably with 
the physical programs of which we speak; that is to say, the principles 
of (a) communication; (b) involvement; (c) participatory decision-maka 
(d) full opportunity to be heard before decision; (e) unrestrained 
consideration of every facet of a question; (f) social justice; and 
(g) competitive negotiations shall be respected. However, within this 
understanding we propose to do the following things in addition to those 
that have been mentioned specifically: 

1. Begin the Verba Buena and Hunters Point building programs; 

The Honorable 

The Board of Supervisors - 13 - October 7, 1968 

(2) Keep the momentum on the present building boom by 
offering; unused or under-used city properties for 
development in accordance with plans devised by our 
Planning Commission and this Board under long-term 
leases. These will include car barns, reservoirs, 
bus lots, Alameda County properties, and some school 

(3) Spur the building of low-price or moderate price 
housing in Western Addition A-2 by utilization of 
ready sites; 

( l !) Complete the buildings in Golden Gateway, Rockefeller 
Center West, and the International Trade Mart; 

(5) Make a decision on Forts Funston, Miley and Mason 
after full hearings and implement those decisions with 

(6) Commence development of our Port by making long-term 
leases on competitive negotiations for immediate 
planning and subsequent building within the tei^ms of 
the Port legislation; 

(7) Make long-term leases for building developments in our 
parks, such as a restaurant in Golden Gate Park, a 
snack bar in Union Square and such other developments 
as this Board and our Planning Commission shall deem 
advisable within the framework of our park policies; 

(S) Commence the operation of bilingual schools in Spanish 
and Chinese; 

(9) Establish a corporation that will develop black 
capitalism in our ghettos; 

(10) Finalize a plan for Alcatraz and for the Palace of 
Fine Arts; 

(11) Decide the Candlestick-downtown stadium question as 
quickly as reasonably possible; 

(12) Negotiate a plan for Angel Island; 

(13) Settle the plans for acquisition of the post-1959 
Brundage Collection which has a value of approximately 

The Honorable 

The Board of Supervisors - 1': - October 7, 19GS 

(l l t) Encourage a plan for a nev; symphony hall and rehearsal 
stage to secure ICO nev; dates in the Opera House while 
we expand neighborhood participation in the culti 
life of the region; 

(15) Develop an expanded park and recreation policy for 
San Francisco; 

(16) Establish a central office for senior citizen 

(17) Complete the construction of at least two nev.' golf 
courses on our watershed properties; and 

(18) Intensify all activities to establish regional con- 
tracts for cooperative action on common problems 
while actively lobbying for regional legislation 
satisfactory to San Francisco. 

All of us acknowledge an unblushing affection for this City. 
The best way to demonstrate that affection is to bend our every effort 
to cooperate in a grand program to make an enduring contribution in 
this generation. That means ridding the City of its social diseases 
as we add lustre to its exterior, enterprise to its spirit, and charm 
to its name. 


Joseph L. Alioto 

*7/ October V. , 196< 


(The City Charter requires the Mayo©, each October 
to make an annual report to the 3oard of Supervisors.) 

A recent Gallup Poll showed Americans preferred San Francisco 
two- to- one over any other city. 

Reasons varied: The City is beautiful. Dynamic. Creative. 
On the move . 

Confirmation comes in a view of San Francisco from across the 
Bay, The spires of new construction, the zoom of jetliners, the 
cluster of ships, the swarm of cars on the bridges. 

Even on the streets of the City, progress is evident; New 
buses and more beat patrolmen; mini-parks; and the prospect of 
Hunters Point redevelopment. 

By almost every index, San Francisco is moving ahead; tourist 
business up S percent; department store sales, 11 percent; and the 
construction boom has soared to almost a billion and a quarter 

San Francisco is rebuilding her skyline, revitalizing her 
-waterfront, transforming her slums, giving energy to new creativity 
in music and the arts. In short, she is in the midst of a great 

Sure, San Franciscans are dismayed by seamy aspects of Big City 
living -- drug abuse, the tawdry Tenderloin, unrelenting poverty. 


Sure, there is disa tisf action and impatience with crime, 
taxes, school problems 2nd much else. And there should be. 

3ut, the disqi'iet differs from • any other cities. It is 
not impotent foot-stamping _ver a lost pest. 

It is purposeful and deliberate, as relentless ai when 
the City rebuilt in 1916, and it seeks change that will erad- 
icate the blight, reduce the crime, eliminate tne desrair and 
bind the City into bold unity. 

San Franciscans are in action, voicing their aspirations, 
underscoring their concerns, compelling action, getting res Its 
and being heard. 

Clearly, San Francisco is not a city of forgotten Americans. 

Every neighborhood is organized; every viewpoint mobilized; 
every interest represented. 

In the ioard of Supervisors, in my office, in neighborhood 
town-halls, San Franciscans offer plans, suggest solutions and 
get things dene. . 

White, black, Spanish-surname, Chinese, rich ana poor, 
business nd labor, young and old, all vigoro sly pursue their 
dreams of e greater city. 

Never h~ve the currents of concern been more vigorous. 

itever has their been more solid give and take o.i matters 
affecting the City's future. 

I have gone to the Sunset and into the Richmond for lively 
meetings . 

I have walked Sju 3runo avenue and met with hundreds in 
Visitacion Valley, lunters Point, ilorti Beach, Chinatown, 
Western Addition. 

Delegations have come to my office from Alamo Square, Haight- 
Ashbury, Bernal Heights, the Marina, Telegraph Hill. 

Merchants, youths, senior citizens, clergymen, conservationists, 
developers all have presented their views in hundreds of vigorous 
forums. Results have been solid: 

* A mini-park for Bernal Heights. 

* More foot patrolmen on San Bruno Avenue and along Fillmore 


* A playground for South Park. 

* Lights for Alamo Square and for Washington Square . 

* Twenty-four additional parking meter attendants for neighborhood 

shopping areas. 

* A health center for Chinatown, North Beach. 

* New stops signs in Miraloma Park and North Beach. 

* A youth program for Visitacion Valley. 

* Fences against vandalism on Ocean Avenue and a guardrail for 

a steep cliff on Potrero Hill. 

Each improvement came out of a single-minded purpose to make our 
City more liveable. Every block has a priority. Some are elementary; 
some surge from national turbulence; all are important, and each must 
be weighed against the means and the needs of the City as a whole. 

The burden falls heavily on the local taxpayer, and it is my primary 
regret that there are so many barriers to reducing the property tax on 
homes — among them: inflation, the State's refusal to reform taxes, and 
the Federal government's new policies to retard urban support. 

Certainly, this year's City budget is prudent and frugal. It was 
drastically cut to bare bone essentials. A new business tax was imposed; 
and major construction was spuixpd to shift more taxes downtown from 
residential neighborhoods. 


L-Jonetheless , this ye2r's tax .ncrease was shar -- $2.^6. Ihe 
increase breaks down tliis way. 

Increased retirement costs, approved by the voters 

ani mostly for police and firemen $ .51 

School District, set independently of the Mayor and 

the Board of Supervisors $ . 7!jS 

Bay Area Rapid Transit $ . 107 

Salary increases 

Police and Fi re $ .20 

' Other City employees $ , 2' 

$2 .06 

Eveuy cent can be j ustified, and other increases in the budget, 
including the City's share for welfare ($22 million of a total 
Social Services buiget of $L 7 million) were covered by increases in 
the assessment roll and by other revenues, including the gross 
receipts tax. 

That tax, by the way, w .11 raise an estimated $7 million this 
year, considerably below original estimates. I want to know why, 
and I have asked for a detailed analysis. 

Lie city, least of all Sen Fr: nc sco, is spendthrift, b t all 
are caught in an inescapable inflation. Additionally, costs are 
backed onto them by a congealing conservatism. 

In Washington D.C., a bloody war clots funis that cold flow 
to cities; housing, health, ed catio ", and other urban programs 
have been cut back; unemployment acutally is being encouraged; 
but sky-high bank interest gees uncurbed. 

In Sacramento, state taxes and expenditures soar, but cities get 
little support. They get none for housing; none for youth employment; 
and, in San Francisco's case, while the average cost of educating a 
student has increased since 1967 from $651 to $850, the State contri- 
bution has remained constant at $125. Additionally, cities must enlarge 
city colleges from their own taxes because the State will turn tens of 
thousands of students away from its universities and colleges. Cities, 
too, must pay hundreds of thousands in police costs when State campuses 
erupt because of short-sighted State educational policies. 

Washington and Sacramento neglect priorities that cities must 
finance through the property tax — schools, mental health, rapid 
transit, water purity, smog control. Cities shape the destiny 
of this nation, and provide the services that most immediately 
and directly affect Americans — putting out fires, catching 
criminals, paving streets, inspiring the young, opening opportunities 
for the deprived. 

Overridingly , however, Washington and Sacramento drain the bulk 
of taxes raised in San Francisco. Nationally, cities receive only 19 
per cent of their funds from the State and only 3.5 per cent from 
the Federal government. 

Additionally, in both Washington and Sacramento, tax relief 
is a sham. The Federal government condones incredible tax loopholes, 
and Sacramento hands out a few dollars to taxpayers only to discontinue 
or drop services that must be picked up and paid for locally. 

Special interest legislation keeps cities handcuffed to the 
property tax, although San Francisco fights for relief through new 
taxes and expanding development. 


■ ■: ■ • 








San Francisco's achievement in no way blurs the need for bold 
and progressive reform. . . . 

By Washington, in assessing national priorities and deciding 
that none is higher than making our cities decent, safe and har- 

By Washington, in advancing revenue sharing so more funds 
go to our cities than to jungle beachheads. 

By Washington, in closing the scandalous tax loopholes. 

By Sacramento, in revising the State Constitution to provide 
lower taxes for homes than for income property. If the Legislature 
and Governor don't act, then Californians should through an initia- 

By Sacramento, in assuming the cost for schools and for wel- 

If taxes are a continuing frustration, so is rising crime, 
a phenomenon thnt cruelly touches every major city in the nation. 

In San Francisco, however, action has been taken: 

* Police pay has been increased and recruitment intensified 
to bring the department to full strength. 

* Foot beats have been re-established in several neighborhoods. 
The entire department is being surveyed to find where pat- 
rolmen can be relieved for street duty by civilians. 

* A cadet unit has been established to give training and to 
free patrolmen from routine jobs. 

* Walkie-talkie systems being developed for foot patrolmen. 

* A special Crime Prevention Detail saturates high crime areas. 


It's clear this activity has impact. Organized ventures into 
crime are severely battered or non-existent in San Francisco. 
Chief Cahill says there is no Mafia. The leaders of the Black 
Panthers are in jail, under indictment or on the run. Pornographers 
are closing up; prostitutes are being rounded up and drug pushers 
are being sent to prison for long terms. 

The war on crime has been stepped up as never before in the 
City's history, and it shall continue unabated. 

One setback, however, was the failure of the Governor and the 
Legislature to support our local police and uphold local gun registra- 
tion. The gun lobby handed the Black Panthers an undeserved victory. 

J. Edgar Hoover of the FBI urges registration, and Toledo, Ohio, 
has reduced gun assaults by 45 per cent and holdups by 54 per cent 
since enacting a law last year. San Francisco's was upheld unanimously 
by the State Supreme Court and, in no way, would have handicapped 
hunters and other legitimate owners. It simply would have given police 
authority to know when and where guns were being stockpiled. 

Crime and taxes jar a community much as an earthquake fault 
might but, in San Francisco, at least, they haven't shaken confidence 
that this city can shape her future for the well being of her residents. 

In every area of civic endeavor, San Francisco bursts with 
imagination and zeal, and her health is abundant, for example: 

SOCIAL HEALTH — Racial tensions have diminished considerably 
in the past year, although they could revive under the recoil of 
white backlash to black extremism. Significantly, whites, particularly 
in the labor movement, are working closely with minorities. 


Some recent developments: 

* Summer HappenThing raised $95,000 for arts programs, the 
transportation of some 15,000 youngsters to Bay Area beaches and 
parks, youth leadership in Western Addition, Chinatown, the Ingleside 
and other neighborhoods. 

* An unprecendented 30 per cent of all apprentices are now from 
minorities, by far the highest proportion in any county in California; 
forceful affirmation of pact between Human Rights Commission, building 
trades, contractors and minority youth groups. 

* Parents and students are now mobilized on committees with 
faculty and administrators to minimize tensions and improve education 
in our junior and senior high schools. 

* Strict ground rules have been laid down to protect dissent 
but prevent violence at San Francisco State College. 

* For senior citizens, the Mayor's Office for Aging is now 
assisted by a Citizens Advisory Committee; the five cent Muni fare 
has been enacted; and a $1 "senior plate" is being offered in 
restaurants and cafeterias throughout the City. 

ECONOMIC HEALTH -- The architects of urban growth see vast 
economic expansion for San Francisco, possibly unique in the 
United States. Some details: 

* Seven major first-class hotels being enlarged or built. 

* Transamerica, Pacific Insurance, West Coast Life and other 
major businesses plan downturn hpadquarters - 


* In the past year alone, 25 permits issued for major buildings 

costing more than $100 million. 

* Ret rn of the Port opens the way for the City's most dazzling 

and imaginative commercial, recreational, residential and 
maritime development of the century. 

* Alroariy, Rockefeller, Dillingham, Oceanic Properties, U.S. Steel 

and other major investors have been drawn to the northern 

* And Port Commission signed first big expansion agreement for 

$100 million. This will return $3 million in taxes — 15 
cents on the tax rate. 

* Alcatraz lures the imagination and has provoked scores of 

proposals for its future. All, whether public or private, 
must meet strict criteria that will (1) assure the greatest 
beauty and optimum open space, (2) maximize public access 
and use, (3) insure excellence in design and execution, 
(MO exact rigid planning controls and (5) guarantee 
adequate finances . 
Redevelopment moves rapidly ahead. In Golden Gateway, Embarcadero 
Center is under construction. In Diamond Heights, 858 housing units 
have been completed, and another 1700 are planned. In Western Addition 
A-l, construction of a 185-unit complex will complete the project. In 
A-2 , emphasis is on development of 2,908 new units of low and moderate- 
priced private housing; the first 218 units will be occupied by the end 
of this year. In Yerba Buena, the $5 million General Electric Office 
building is under construction, and the $25 million Del Monte World 
Headquarters will get under way next year. In Hunters Point and India 
Basin, site preparation is underway for housing, and land acquisition 
commenced for Industrial Park. 


* Public housing accelerates construction. Work on 1300 units 
will begin within the next nine months, and the Planning Commission 
is assisting the Housing Authority in locating sites for a total of 
3,000 approved last year by the voters. Additionally, the Housing 
Authority has some 800 units leased in private dwellings. The 
Authority has taken the lead in urging Congress to approve funds for 
modernizing old housing projects and for improving tenant services. 
A final note: Private construction of moderate-priced homes must be 
spurred, and I am convinced one way the Federal government should plow 
funds back into the community is through expanded subsidies to the 
housing industry. 

* There are other significant thrusts toward development: 
Model Cities, underway in Hunters Point and developing in the Mission, 
will evaluate the need for health centers, recreation areas, housing 
and other social action in those neighborhoods. The addition of 
Alamo Square, the Duboce Triangle . Rnd Bernal Heights brings to seven 
the number of neighborhoods in the Federally Assisted Code Enforcement 
(FACE) program for low-interest loans for residential conservation. 
Furthermore, the Planning Commission is completing its South Shore 
Study for rejuvenation of that area and is engaged in the City's 
first comprehensive inventory of housing. It also is developing 
plans for promoting industrial development. 

* Transportation improves. Muni has 190 new buses and will have 
another 10 by the end of the month; 200 more are on order for delivery 
by next February; and 25 mini-buses will be delivered by June. 

Muni should consider rapid subways downtown from major residential 
areas. Furthermore, there should be complete reeval nation of downtown 
traffic patterns and enforcement policies. 

- 10 - 

Mew public garages are slated for Marina, North Beach, Excelsior. 
BART continues to progress, and bids should determine whether a West 
Portal tunnel is feasible or whether funds would be better spent on 
some other phase of the San Francisco system. Transportation to 
the International Airport remains critical, and BART should be 
extended to the terminal. 

International Airport, the world's fourth largest, continues 
to expand. The next phase will total $141 million. Public and pri- 
vate construction will exceed $600 million by 1975. 

Public Utilities Commission pushes ahead on getting greater 
financial return from its lands for the City. Income from leases 
on Water department leases increased $220,000 to $7'o,000 during the 
year, and PUC's Bureau of Utilities Property Management has given 
priority to the development of the bus storage yard in Horth 3each, 
the car barn at Geary Blvd. and Presidio Avenue and an industrial park 
near Pleasanton. 

In all this development, with its enormous investments and 
creative designs and vast prospects for the future, one concern 
has remained overriding: ; The well being of San Franciscans. 
They've spoken pro-and-con at public hearings on all development 
proposals. In Hunters Point and the Western Addition, residents 
have helped plan redevelopment. In Chinatown, residents participated 
in an unprecedented study of all aspects of life there. 

Labor peace has remained stable with my office participating in 
the settlement of strikes. For persons displaced by construction, 
the City has undertaken a pioneering program in relocation and a 
$300,000 rental assistance program for the needy. More than 3,000 
persons have been successfully relocated. 


EPVIROi' 1 ENTAL HEALTH -- San Francisco's most precious resource 
is her beauty, ana it must be fiercely guarded. Cities have Life- 
styles, and San Francisco's is among the most zestful ana inviting in 
all the world. San Francisco continues to be a mecca for persons of taste 
and artistry, and her rare splendor of hills and bay adds a quality to 
life unequaled in all America. San Francisco and all California must 
proclaim a steadfast goal: Protect our natural beauty and insure an 
environment that is healthful, inspiring and invigorating. 

Fundamentally, we must insure that the public interest is paramount 
in any decision affecting the quality of our environment. 

Action can't be deferred for another decade unless we want our 
skies dulled by pollutants, our coastline slicked with spillage and our 
Bay a quagmire. 

San Francisco continues to fight diligently for the conservation 
and enhancement of our environment. Some details: 

* Continues opposition to freeways slabbed against our skyline, 
/he Embarcadero Freeway and all future freeways must be underground. 

** Victory against the auto lobby by compelling the re-routing 
of Junipero Serra ireeway to protect our lakes and the development of 
the entire Peninsula watershed as an unparalleled recreation and 
wilderness area. 

*' Willing surrender of jurisdiction over all shorelines for a 
width of 100 feet to the Bay Conservation and Development Commission. 
Few cities have given up so much for conservation. 

Development of some 33 mini parks for added open and green space 
throughout San Francisco. 

Planted 13,000 trees on our streets and lanoscaped some 25 3 acres 
of public lands. 

- 12 - 

Embarked on landscaping, the construction of playgrounds and 
other recreational facilities in undeveloped areas of McLaren and 
Golden Gate parks as part of a $609,000 Federal grant to San Francisco 
for urban beautif ication. 

* Stepped-up efforts to control Bay pollution. Development of an 
air-floation system may be a major breakthrough toward water quality 
control, and bond issues for expanded sewage plants planned for the 
next several years. 

* Continued battle against dirty air. Asked Federal Court to 
compel Justice Department to prosecute its suit against auto makers 
for restraining further development of anti-smog devices. 

* And, always, efforts to exhalt human values, giving lift 

to the spirit and zest to the mind, continue unabated. The Neighbor- 
hoods Arts Program gives dimension and vitality to the City's potent 
and unique cultural diversity. The acquisition of all the fabulous 
Brundage Oriental Art Collection establishes San Francisco as one of 
mankind's great art centers. The Poetry Center at San Francisco 
State, the institutes of music and art, the theater ignite genius 
in our young. The magnificent artistry of our symphony, the opera 
and ballet confirm the City's artistic pre-eminence. 

In summary, the past year has been a vital one for San Francisco, 
and many of the goals set forth in last year's State of the City 
Message have been accomplished: Yerba Buena and Hunters Point 
redevelopment are underway; PUC lands are earning more revenue. 

Western A-2 is launched; Embarcadero Center is underway; Port 

- 13 - 

development accelerates; bi-lingual education in our schools is 
expanded; the Brundage collection is the City's; black capitalism 
is spurred; recreation and park policy is expanding; an Office 
for the Aging is serving the City's 100,000 senior citizens; 
neighborhoods arts have been encouraged and regional co-operation 

Some goals carry-over, and new ones assert themselves, and the 
old and the new together stand out as priorities for action in the 
next 12 months. They are, in random order; 

1.) Continue to spur the City's building boom by international 
design competition for unrivaled - architectural :dis tinctioa. Beauty, 
not bulk, is essential. Dramatic lines, color, texture, ample and 
graceful plazas are sought under the strict supervision of the 
Planning Commission. 

2.) Keep alive a constant debate on environmental beauty and 
a constant assault against the poisoning of our environment. 

3.) Maintain the social equilibrium so that San Francisco never 
becomes a central ghetto surrounded by white suburbs. 

M.) Extension of BART to the airport. 

5.) Final solution to garbage disposal. 

5.) Bridge the gulf between the racially divided police 

7.) Solidify black and union leadership behind the orderly 
continuation of major construction projects and against any confrontations 
as in Chicago and Pittsburgh. 

C.) Accelerate new construction starts in Western Addition, 
Yerba Buena, Golden Gateway and Hunters Point, Islais Creek redevelopment 


9.) Maintain stability in our colleges and our high schools 
through concerted action by educators, parents and students. 

10.) Carried over from last year: Negotiate a plan for Angel 
Island; develop Palace of Fine Arts; and arrange lease for restaurant 
in Golden Gate Park. 

11.) Rejuvenate the City's shipbuilding industry. 

12.) Consolidate transportation plans for effective mass transit 
from Marin, the Peninsula and within the City. 

13.) Make city government more responsive to the people and to our 
times through ChaiMrer Revision. Modernization of the Mayor's office 
and other administrative agencies will be on the November ballot, the 
first such revision in over three decades. The revision will bring 
greater order to City budgets, improve efficiency, cut out duplication 
and provide greater voter participation. 

1M. ) luild a new school in Hunters Point and develop new parks 
with a bond issue on the November ballot. 

15.) Endorsement of an elected school board, but not by divisive 
districts that could deny just representation. 

16.) Rehabilitate the Mission District with the emphasis on 
remodeling and repair to preserve the unique quality of that historic 
area. Immediate selection of one block as a "show case" and an 
invitation to action. 

17.) Advance plans for a courthouse in Civic Center and for the 
remodeling of City Hall. 

18.) Continue to work with police in increasing street patrols, 
modernizing communication and other facilities, professionalizing 
standards and intensifying the crackdown on crime. 

- 15 - 

These objectives are stepping stones into the 1970' s. The 
sixties were schizoid — a seemingly endless war; and the glory 
of the flight to the moon. 

This was a decade of challenge. The next will be one of 

The goals are clear: end the war; develop our cities; assure 
justice. With wisdon and with courage, I am confident of their 

San Francisco, a leader among cities in the 19C0's will be 
even more luminous in the 1970' s 

She will continue to extend hope to the hopeless, opportunity 
to the aspiring, inspiration to the talented, satisfaction to the 
hard-working. San Francisco will remain a City where Americans 
can be proud of themselves and of their heritage, and whe re the 
vast majority of them long to live. 






October 5, 1970 

The Honorable 

Board of Supervisors 

Room 235, City Hall 

San Francisco, California 94102 FEB 3 1972 


Ladies and Gentlemen: public library 

Once again I come before you, for the third year, as Section 25 
of the Charter provides, to report to you and the people of San Francisco 
on the state of affairs of our City. 

Despite the common problems we share with major cities throughout 
the country, a cold, realistic analysis of what has occurred in San 
Francisco during the past year, and what has not occurred, and what 
obviously is going to occur, should give all of us an optimistic and 
reassuring anticipation for the days, months, and years that lie just 
ahead of us. 

I say that San Francisco can have its greatest era ever. I say 
that all San Franciscans, of every race, color, and creed that have 
joined together to overcome disaster, fire, earthquake, and depression 
in the past, can add luster to our reputation as one of the world's 
most envied places in which to live. 

Some exciting things are happening in San Francisco today. Some 
of these things are happening in our poorer neighborhoods -- some 
downtown -- some in our city government departments — some along our 
waterfront — some in expanding the role of our minority groups in 
government and private industry -- some in cutting back the crime rate 
and incidents of violence, in dramatic contrast to the national trend. 
At the same time we are achieving a more equitable division of the tax 
burden despite frustrating inaction at the State level in providing 

- 2 - 
meaningful tax reform. 

It has not been easy. There have been heavy demands on our 
energies and resources. There have been fears that some of our debates 
could cause violent division in our community. 

It is, therefore, with a sense of joint accomplishment as well as 
appreciation, that I commend this Board of Supervisors, and all the 
departments and agencies of this city government for their devotion and 
dedication to serving the best interests of our entire community. 

Not all the City's departments and agencies have been mentioned 
here. I want to stress that the importance of the work of those not 
named is not to be measured by this absence. Without the contribution of 
each of them, the successes and accomplishments of many of those that are 
cited here would not be possible. The annual reports for 1969-70 of each 
department and agency, however, are attached for the information of this 
Honorable Board. 

Before I report to you in more specific terms, let me briefly 
mention a fev; highlights which, I believe, justify my confidence that San 
Francisco is on the way to even greater achievements and recognition: 

1. The nation-wide rash of rising crime rate and violence in the 
streets has been successfully reversed in San Francisco as evidenced by a 
10 per cent drop in the crime rate since the beginning of the year. 

2. The City and County government's share of the tax rate has been 
reduced about 5 cents from last year. Even with a substantial school tax 
boost, the over-all property tax increase was among the lowest in the 

3. A series of actual and threatened labor strikes was negotiated 
expeditiously and without the dislocations that have occurred in other 

- 3 - 
cities throughout the country. 

4. Minority employment in the city government improved signifi- 
cantly - just about equaling the over-all percentage minorities have of 
the city population. 

5. Ties between the city government and community groups in the 
poverty neighborhoods were strengthened tremendously by an enthusiastic 
coalition formed to combat the Federal urban renewal funding crisis. 

6. The City's ability to pass vitally needed - and fiscally less 
expensive - water, school and recreation bond issues was greatly enhanced 
by the joint administration and neighborhood action which led to the 
historic State Supreme Court decision striking down the 2/3 rule. 

7. Two of the City's worst ghetto poverty areas, the Western 
Addition and Hunters Point, continue their transformation into attractive 
residential communities for the same people who have lived there for 

Law Enforcement in the City 

Last February, the San Francisco Police Department had a change in 
its top administration and I made a simple, but not easy, request to the 
new police chief, Al Nelder. I said: "Reduce crime! " 

I can report today that Chief Nelder and the men he selected to 
carry out this request have done just that — reduced crime in San 
Francisco. There is still much more to be done. However, our City 
streets are safer now for our families, our children, our elderly 
citizens, and for the visitors who come to envy us the privilege we have 
to enjoy San Francisco all year around. 

- 4 - 
For the first eight months of this year in the six major crime 
categories used for keeping statistics, the crime rate was down 10 per 
cent. There were 3,156 less crimes this year up to the end of August in 
these classifications than in the same period last year. 

This decrease can certainly be attributed to a substantial degree 
to Chief Nelder's implementation of another request I made that more men 
be put out on San Francisco's streets on patrol duty. 

By the beginning of this month, more than 50 men had been added to 
the uniformed street force since last February. By next June another 117 
police officers will be added. These additions are not being made through 
the hiring of more men in the department. The first 32 additional patrol 
duty assignments to the district stations resulted from the elimination 
of some administrative and clerical jobs. The remaining ones resulted 
from the transfer of other officers performing clerical duties. They are 
being replaced by lower-salaried civilian clerks furnished from the Civil 
Service lists as funds for their employment become available. 

Another significant factor in the reduction of crime in San 
Francisco has been several innovations set in motion this year by Chief 

One is the Golden Gate Park and Beach Squad of 12 police officers 
on lightweight motorcycles. Supervised by two sergeants using jeeps, the 
"Scooter Squad' 7 has made some MOO arrests in Golden Gate Park and the 
Ocean Beach area since last February, thus helping to return the park to 
the peaceful citizens of San Francisco. Vandalism incidents have also 
been sharply reduced. 

Perhaps the most significant long-range program in which the Police 
Department is now concentrating its efforts is that of the Community 

- 5 - 
Relations Bureau. Since last February, the Bureau's staff has been 
increased by 55 per cent. The principal objective of the stepped-up 
effort is the establishment of police rapport with the City's minority 
communities, at the so-called "grass roots" level. Chief Nelder has 
instituted free coaching classes for all disadvantaged candidates seeking 
to join the Police Department. 

The success of this intensified program was evident from the 
noticeable lessening of tensions and hostility this past summer toward 
the Police Department in areas where there had been dire predictions of a 
rash of violent incidents. 

At present special efforts are being directed toward improved 
police relationships with the Spanish-American and Chinese communities. 
Thirty-two police officers are now taking classes in the Spanish language 
and culture at the Centro Social Obrero in the Mission District. Another 
six officers are now enrolled in classes for the study of the Chinese 
language and culture. 

Sharing the role with the Community Relations Bureau as the best 
possible channel for police efforts to reduce the City's crime rate is the 
department's Juvenile Bureau. With orders from Chief Nelder to increase 
the emphasis on youth programs, ten police officers have been added to the 
Juvenile Bureau since last February. The Police Youth Program has 
produced results. More than 40,000 youths in San Francisco have been 
involved. This year, the California Youth Authority gave its award for 
outstanding work with youth to the San Francisco Police Department. This 
is the first time the award has gone to any police agency. 

The program includes police officers holding "rap" sessions in 
schools, hosting picnics at the police range, permitting students to ride 

- 6 - 
in patrol cars to observe police activities on a first-hand basis, San 
Francisco Bay boat excursions for disadvantaged youths, trips to 
Disneyland, bowling tournaments, and golfing matches. 

There is an increased flow of illegal drugs and their use in San 
Francisco today, as is true in practically every large city in the country, 
including those in California. This has made it necessary to assign an 
additional eleven officers to the Narcotic Bureau of the Police Department. 
Enforcement emphasis on the "big time : ' supplier has brought a close 
working relationship between the Narcotic Bureau and the department's 
Intelligence Unit. Coordination between the hand-picked inspectors in 
the two units has resulted in approximately 4,500 arrests this year and 
the seizure of large quantities of illegal drugs. 

The increased incidence of reported narcotic use in the schools 
has resulted in the carrying out of an education program for the San 
Francisco Unified School District, the parochial schools, civic groups, 
the Youth Guidance Center, and the business community by the Narcotic 

A concentrated effort has been carried out by the Police Department 
looking toward improvement into the management of police activities. 
Design of a computer system that will aid the department in reducing 
criminal activity is a high priority for the department. Some $2 million 
in Federal grants has been sought for technical aids and training 
programs; a half-million has been acquired since last May. 

Chief Nelder has made several suggestions for additional funds that 
he feels are vital. I would like to pass one of them on to you. It is 
for a bond issue to fund the relocation and improved design of some of the 
existing district police stations. Only the Central Station is situated 

well enough geographically to provide effective or efficient police 
service, and the poor planning of the stations uas tragically demonstrated 
earlier this year by the fatal bombing of Park Police Station and the 
attacks on several other stations. 

Taxes and the City 

Inflation has hit San Francisco just as it has other communities 
throughout the country. The costs of our government services and goods 
have increased tremendously. As in past years, I have resisted and fought 
against an increase in the homeowner's property tax to pay for the 
increased costs. San Francisco has been especially severe in using this 
practice. We have had one of the narrowest tax bases in the United 
States, constantly going to the homeowner's property tax to make up 
seemingly inevitable deficits. 

When property tax relief failed in Sacramento and the Governor 
refused to call for a special session on the issue, we unavoidably had to 
seek other sources of revenue if the City was to meet its bills. After 
careful scrutiny and spirited debate, your Honorable Board passed and I 
signed several revenue measures which had the effect of shifting $15 
million off the backs of homeowners and renters. A reduction of 75 cents 
on the anticipated property tax rate was achieved. 

The portion of city expenditures controlled by the Board and my 
office came down 5^ cents on the tax rate from last year, or to $7.53. 
The over-all increase from $12.29 to $12.82 per $100 of assessed valuation 
can be attributed, in the main, to School District budgets over which 
neither you nor I have any control. 

Where there was control, $70 million in departmental requests for 
funds was slashed for the current fiscal year. Further economies continue, 
For example, at present I have not acted upon more than 100 requisitions 
for the filling of vacant positions in city government. I have constantly 
stated that I will not act on any one of them until the need for each one 
is demonstrated to me. 

The new tax rate and its changes from last year are : 
1969-70 1970-71 





Air Pollution Control 




School Funds 




Rapid Transit 




12.29 per $100 12.82 per $100 .53 
For what little consolation it may be, the 53 £ property tax 
increase we are receiving is the third lowest among the State's largest 
twelve cities, according to a list released last week by the non-partisan 
and privately financed San Francisco Bureau of Governmental Research. 
Only Santa Ana and Fresno have smaller increases than San Francisco among 
the dozen cities with populations in excess of 100,000. Los Angeles had 
an increase of $1.31, Oakland $1.48, San Diego $1.16, and Sacramento a 
startling $2.33. These were all more than double the San Francisco 

Labor Peace in the City 

San Francisco has always jealously coveted its reputation as one of 

the strongest labor union cities in the country. It has meant that the 

ordinary worker, the backbone and strength of any meaningful and strong 

- 9 - 
economy, has the status and respect among the community that his efforts 
and contributions deserve. 

San Francisco and its union members have also had a deserved 
reputation for responsible leadership and sensitivity for the public 
welfare. However, sometimes in the heat of resentment, justified or 
unjustified, concerning alleged inadequate benefits including wages, a 
strike will break out. If it is allowed to drag on without prompt 
negotiations between labor and management, there can be great damage and 
prejudice caused to all parties, including the public. 

One has only to recall the paralyzing garbage, transit, and 
teacher strikes that struck eastern cities in the past 18 months to be 
aware of what a bitter strike can do to a city. Fortunately, this year 
we were able to move quickly and effectively in San Francisco, even in the 
face of the tensions generated by our inflationary recession, to cut off 
a number of threats to our labor peace. 

For example, a city employee strike last spring, which threatened 
to become a general strike shutting down the City, started on Friday and 
was settled by Monday after a grueling weekend of peacemaking efforts 
which heavily involved my office and members of this Board. 

Then there was a series of wildcat, hit-and-run teamster strikes 
last May due to a dispute entirely outside of the Bay Area which affected 
adversely the San Francisco Airport, hospitals, supermarkets, and our 
two daily newspapers. This was a complex and difficult dispute which we 
finally settled after touch-and-go negotiations. 

Last summer, San Francisco had the threat of its first firemen's 
strike. The issues concerned the request for more men, the number of 
working hours, and the grouping of these hours in a time period. Once 

- 10 - 

again, with the sensible and reasonable attitudes which we in San 
Francisco normally come to expect in our labor disputes, a potentially 
dangerous strike was avoided. 

Thus, unlike many cities throughout the country where violence, hate, 
and economic hardship hit workers and their families, management, the 
general public, and local government, San Francisco had general peace on 
its labor front. 

The Look of the City 

The importance of such basic concerns to all of us as the cost of 
government, law and order, our schools, and a fair taxation policy have 
tended to obscure somewhat various developments that are determining what 
San Francisco will eventually look like. Some rather dramatic things are 
already happening. 

One is in the field of housing. Despite a drastic cutback in 
Federal funds and a serious shortage of city financial resources, San 
Francisco has done more in the housing field than most people realize. 
I believe that a realistic, long look at what is going on in housing in 
San Francisco is long overdue. 

For one thing, there has been a rising percentage of the City's new 
housing which is involving public programs of one type or another. These 
developments are spread across a fairly wide range of income levels, and 
the majority of them are not limited by any means to public housing. 

I belive it highly worthy of mention to report that in the next 
12 months alone more than 3,000 new units of low- to-medium income housing 
are scheduled to be completed in neighborhoods throughout the City. 

Also worthy of note is that while the major part of this housing is 

. 11 - 

concentrated in the Hunters Point and Western Addition renewal areas and 
downtown, a new direction is evident in placing public housing units of 
top architectural design in scattered areas of the City. 

Incidentally, the fruits of a difficult public housing effort by 
San Francisco are just becoming visible. Two projects of 188 new units 
were completed in the last year. Five projects totaling 638 units for the 
elderly are now under construction. Another eight projects with 1,159 
units for the elderly and 241 family apartments are now in the advanced 
planning stages. These projects are in different sections of the City. 

I am also pleased with the fact that San Francisco is the first city 
in California, and one of the first in the nation, to come up with a clear 
and complete housing policy and compendium of programs to be followed. 
This comprehensive plan for housing in San Francisco is 

now ending a series of public hearings after wide exposure throughout the 
City to neighborhood groups and civic associations for their reactions and 
comments. This plan is expected to reach your Honorable Board for its 
consideration late this year. Such a policy statement is now required by 
State law to be incorporated in a city's master plan before it can be 
eligible to share in Federal funds channeled through the State to cities 
for public projects. 

Now being prepared by the City Planning Department is an urban 
design plan for San Francisco. The cost of preparing this plan is being 
financed by the Federal funds we obtained. 

Other plans have been prepared and are ready to be implemented as 
Federal funds become available. A proposed housing project on the 
abandoned site of the former Regal Pale Brewery in the inner Mission 
should soon be before you. A South Bayshore Plan to revitalize the 

- 12 - 

southeastern corner of the City, prepared in close cooperation with the 
residents, has been published and approved by the Planning Commission. 
Rezoning has already started. It gives that community a prepared possible 
base for its model city program. 

This Board has already passed ordinances limiting the size and type 
of signs that can be displayed on Market Street and prohibiting signs high 
on the sides of buildings. 

The City's minipark program has made remarkable progress in the 
short space of two years. Seven new parks are now open throughout the 
City for children and senior citizens, another eight are under construc- 
tion, and sixteen are in various stages of planning. 

Perhaps the outstanding visual evidence of what is going on in 
San Francisco's over-all urban beautification program, for which the City 
has received a pledge of more than $420,000 in Federal funds during the 
past year, is the activity on Market Street and on Mission Street from 
15th Street out to the 16th and 24th Street BART stations. 

I am particularly proud of this administration's success in 
obtaining Federal funds for urban beautification. Three years ago, the 
City had not received a dollar for this purpose. At the end of the 
1969-70 fiscal year, San Francisco had received grants totaling more than 
$1.5 million in urban beautification funds from the Federal government. 
This brought San Francisco from zero to eighth among the cities of the 
country in the total amount of this type of funds received. This money 
was in addition to approximately $1.2 million received by the City from 
the Federal government in minipark and open space grants during this same 

A Northern Waterfront Plan, completed and approved by the City 

- 13 - 

Planning Commission, is now being implemented by rezoning. There are 
several proposals from private developers to carry out aspects of the plan 
concerning a line of old finger piers near Market Street and the Ferry 
Building. These piers are abandoned and rotting, and block off physical 
and visual access to the Bay. Under the plan they would be replaced by 
several lovely marine complexes of walkways, parks, office buildings, shops, 
and pedestrian attractions that would be an aesthetic, as well as financial, 
asset to the City. 

I believe that this prospect will be furthered by the Port 
Commission taking definite action to grant in trust to the Recreation and 
Park Commission - subject to voter control for the next 66 years - the air 
rights above M-0 feet along the waterfront from Pier 9 at the foot of 
Broadway to Aquatic Park. Indeed, I believe this proposed action 
expresses so well my administration's firm intention to safeguard our 
magnificent vistas that I have proposed today to the Port Commission that 
it undertake such a lease arrangement immediately. It should not make the 
exchange conditional on whether your Honorable Board approves the 550- foot 
Ferry Building Special Height District as spelled out in a Port Commission 
resolution. Regardless of what specific height you approve, the trust 
exchange should take place. 

Related to our determination to improve and restore the beauty and 
appearance of our waterfront is an insistence that the Embarcadero Freeway 
be razed and placed underground. The State Highway Department must realize 
that the City will not seriously discuss any freeway links between the 
Golden Gate Bridge, the Bay Bridge, and the Southern Freeway without an 
agreement that the Embarcadero Freeway come down and that any future 
freeway construction in the City be underground. 

1H - 

Since I last reported to this Board, San Francisco's first four 
FACE, or Federally Assisted Code Enforcement programs have been completed 
in Glen Park, Buena Vista, the Great Highway, and the Inner Richmond. 

Also, San Francisco and San Mateo County have entered into a joint 
agreement and have started detailed planning geared to extending BART to 
the San Francisco International Airport. A plan is expected to be ready 
about one year from now. 

New FACE programs to restore and refresh neighborhood areas that 
have not deteriorated too far are awaiting the availability of Federal 
funds. They include the upper Haight-Ashbury section which hopefully will 
be before this Board for action in the near future. 

Federal money, plus funds from the San Francisco Foundation, has 
already been received for an action oriented plan for housing and 
recreation in Chinatown. This planning is already under way with 
information for the community and news releases for the Chinese press 
being issued in Chinese by the City Planning Department. 

- 15 - 
The City's Economy 

In some key areas, the City's economy has managed not only to keep 
up, but to outdistance inflationary figures. Construction for the 1969-70 
fiscal year was up a startling 65 per cent from the 1968-69 figure. The 
volume of the estimated cost of construction went from $190.5 million to 
$314.2 million. Last year I reported a 13 per cent increase. 

Much of this building boom, with the thousands of construction jobs 
and subsequent new permanent service and white-collar jobs resulting, 
comes from the new high-rise office and hotel buildings in the downtown 
area. These include the new PG&E headquarters building, the Embarcadero 
Plaza complex of the Rockefeller interests, and the Hilton and St. Francis 
Hotel expansion towers. 

Property values continued to increase in San Francisco as the 
demand remained steady. The approximate $2.4 billion figures of the 
Assessor for July of this year represented an increase of $38.9 million 
over last year. 

San Francisco's maritime industry figures also represented in- 
creased volumes of movement. Exports for 1969-70 were $1.8 billion, up 
37.7 per cent from the year before. Imports were $1.2 billion, up 17 per 
cent. Ship arrivals totalled 2,067. 

The Port of San Francisco, now owned by the City, has announced 
plans for expansion to improve its cargo handling methods. These include 
the already started construction of a 48-acre LASH (Lighter aboard ship) 
terminal in the India Basin area of the Bay. Adjoining it will be a 
Container Terminal of 110 acres. Now being completed is a Grain Terminal 
on the Islais Creek Channel. Also planned are a 48-acre two-berth primary 
container facility in India Basin and an 80-acre installation near Central 

- 16 - 

S ocial ^Programs _ in_ the City 

Social programs have had the highest priority in this administra- 
tion and will continue to receive this attention. 

One of the major tasks in recent months has been the merging of 
all sectors of the community to achieve a revital ization of the Economic 
Opportunity Council which has had both financial and administrative prob- 
lems. I am happy to report that my Social Programs Office advises me 
that a solution is being worked out and that prospects are bright that a 
strong city-wide poverty agency with heavy community involvement will be 
in operation shortly. 

Of particular significance was the release last month of a survey 
by the Human Rights Commission which feund that the City was a major job 
provider for minorities. Minority participation in Civil Service jobs 
was found to be almost 30 per cent, approaching closely the 35 per cent 
of the San Francisco population that minorities constitute. 

Tying in with this was a report from the State Department of 
Industrial Relations which stated that 38.1 per cent of new apprentices 
in skilled jobs in San Francisco in 1969 were from minorities. This per- 
centage far outdistanced that achieved in all other counties and main- 
tained for San Francisco the preeminent lead in this field in the entire 

Our Summer Youth Program this year provided jobs for about 7,000 
teen-agers, some 400 more than last year. This was accomplished despite 
some employer resistance, bad business conditions, as well as federal 
threats of funding reductions. 

A $180,000 federal recreation grant was obtained by the City for 
recreational equipment for young children. It was used to supplement 

- 17 - 

programs carried out by the Police Department , Recreation and Park Depart- 
ment, and the Goiden Gate Neighborhood Centers Association. 

The Neighborhood Youth Corps operation of 2,000 jobs achieved more 
community participation through involvement of target area youth councils. 

A Clean Water '70 federal program enrolled 100 teen-agers in 
anti-pollution activities during the summer. These included neighborhood 
clean-up campaigns and rat control projects. 

A Master Plan for the Aging is currently being developed by a 
committee of professionals and senior citizens. It is expected to produce 
comprehensive and realistic programs suggesting methods of approaching a 
full range of problems including those of physical and mental health, and 
housing. Meanwhile the City's downtown area with its heavy concentration 
of poor elderly people is not being ignored. A Downtown Senior Center 
was opened by the City last July 1. Counseling, job referrals, a library, 
craft activities, and limited food service are now offered at the center 
to some 1,000 people. A "Senior citizens plate" program has been estab- 
lished in many restaurants to offer elderly people nutritious, well- 
balanced meals at low cost. A widening of the time span from 9:30 a.m. 
to 3:30 p.m. when senior citizens can ride the Muni for a five-cent fare 
has just been put into effect. 

The City's Physical Plant 
Probably the year's most significant city administrative change 
took place in June with voter approval of a new Airports Commission to 
operate independently of the Public Utilities Commission. Governing the 
fifth largest airport in the world, with 15 million in-and-out passengers 

- 18 - 

annually, the new Commission will guide a $175 million construction pro- 
gram for the airport's expansion in the next seven to eight years. It is 
not being done any too soon. In 1969-70, air freight volume went up 5.5 
per cent, air express volume increased 9.6 per cent and 280,000 more 
passengers went through the airport than the previous year. 

It is estimated that the airport currently represents $1 million 
in business a day for San Francisco's economy. 

The first preliminary study looking toward the extension of BART 
from Daly City to the airport has been completed. A joint powers agree- 
ment with BART and San Mateo County was also concluded for a study of a 
rapid transit system that will link the airport with several Bay Area key 

The Municipal Railway took a series of steps to get ready, despite 
budgetary problems, for the advent of the modern BART system as a co-tenant 
of the subway tube under Market Street, and out to the Mission and 
Visitacion areas. 

A $46 million modernization plan which would lower the operating 
cost of the system was submitted to the Public Utilities Commission late 
last month. If I had any doubts about the need for modernization funds 
by the Muni, they were dispelled recently when I learned of conditions at 
two installations. At the Muni's Geneva Division, men are working in one 
building that is rated as dangerously weak from the effect of the 1906 
earthquake. In the Elkton Division shops, machinists nave to quickly pull 
out tarpaulins to cover their machines when rain starts pouring through a 
leaky roof. 

The Muni has also completed purchase of 400 new motor coaches. 
These are the first ones to be acquired in ten years, although the Muni 
furnishes about 600,000 persons with service on 64 routes. 

- 19 - 

Soon to be acquired are 25 "Muni mini" transit coaches for shopper 
and neighborhood shuttle services. 

The Muni also reported that its total of traffic accidents in- 
volving Muni vehicles was down nearly 25 per cent from four years ago. 
It was down 15 per cent from last year. 

In keeping with the increasing emphasis on pollution control, the 
Public Utilities Commission has instituted a program to maximize electric 
transit on the Municipal Railway vehicles in an effort to establish the 
feasibility of providing pollution-free transportation. 

To provide the Muni with this electrical power at a low rate, and 
at the same time save money, the Public Utilities Commission has been 
using $1 million of the $1.5 million additional revenue it received this 
past year from operation of its new Moccasin Powerhouse in Tuolumne County. 

Completion of the Don Pedro Dam near Modesto, second highest dam 
in the State, will double the average daily water supply for the City's 
service area. 

In the field of water pollution, an agreement was reached with 
the Regional Water Quality Control Board for additional sewage disposal 
work. The agreement provided for completing the work for dry weather 
sewage flow by 1973, for moving up the placement on the ballot of a $65 
million water pollution control bond issue for 1971 to next month when it 
will appear as Proposition A, and for expediting the preparation of an 
industrial waste ordinance which is now before this Board. 

For wet (rainy) weather sewage flow, the City expects to complete 
this week a demonstration $2 million "air flotation" sewage treatment 
plant which is being jointly financed by the federal government and the 

- 20 - 

Starting late this month, San Francisco's solid waste garbage will 
be trucked to Mountain View and used for fill in an area destined to 
become a 544-acre regional park for use by all residents of the Bay Area. 
A transfer station where the garbage will be compacted is being constructed 
now near the county line. This arrangement was reached by the City with 
the city of Mountain View and the Sanitary Fill Company garbage firm. 
It will be in force for at least five years, by which time it is hoped 
we will have a long-range solution to the disposal problem. 

The first phase of a new $39.5 million San Francisco Medical 
Center on the grounds of the present San Francisco General Hospital is 
now expected to be completed by next April. 

Just completed in the historic Palace of Fine Arts is the new 
Little Theatre, which will be inaugurated later this month as the new 
home for the annual San Francisco Film Festival. 

The inital work on the new Army Street Circle Project has also 
been completed. Southbound Potrero Avenue traffic can now proceed 
directly to the James Lick Freeway or Bayshore Boulevard without encounter- 
ing any cross-traffic at Army Street. 

Traffic congestion has been greatly reduced in the downtown area 
by the establishment last June of new truck loading zones, no-stopping 
restrictions, and towaway zones. Additional one-way streets were just 
approved by this Board. 

I respectfully submit this report to the Honorable Board of 
Supervisors on the state of affairs of the City. 


Joseph L. Alioto 
Encs. Mayor 





October 4, 197] 


The Honorable 

Board of Supervisors 

Room 235, City Hall 

San Francisco, California 94102 


FEB 3 1972 


Ladies and Gentlemen: 

I present to the Board of Supervisors and the people of San 
Francisco today a report on the state of affairs of our City as 
required under Section 25 of the City Charter. 

Like every other major American city, San Francisco is embroiled 
in the urban crisis. Unlike many of those cities, San Francisco shows 
some healthy signs of being able to survive it. 

There will always be those who cannot resist the temptation to 
despair over our problems and even to walk away from them with the 
parting prediction that they will not be solved. 

There are problems, problems of uncrsplcyrr.cnt: , ~f insufficient 
housing, of polluted air and water, of too much to do with too little 
funds . 

However, these problems can be solved and they are being solved 
here in San Francisco because we have forged a great urban coalition 
with all our people and have given them hope for the future and the 
desire to preserve this great City. 

There does not exist in San Francisco the sullen apathy of a 
Detroit or the sheer hopelessness of a Newark or the massive abandon- 
ment of other big American cities. 

We are building new housing, we are creating new jobs, we are 

- 2 - 

feeding our poor. 

With the hard work and help of this Board of Supervisors, we are 
trying to give our City a sense of direction and purpose, a sense of 
dedication to the idea that San Freincisco is something different, 
something precious worth saving, and its people douhly so. 

The task that has faced my office and this Board is not easy nor 
is it likely we are to see it come to full achievement in the immediate 

Perhaps the most signifcant problem we face is one of funding. 
Demands for money for programs we all recognize as useful and important 
can no longer be met by the property owner who already suffers under an 
inequitable load. 

These demands are made at a time when unemployment and inflation 
have become a national syndrome, afflicting every city in the country 
from the smallest to the largest. 

This bleak economic picture has been further darkened by the 
failivce so far of thp Federal government to pass revenue-sharing and 
the state government to initiate a program of meaningful tax reform. 

Until we have this desperately-needed relief, we must continue to 
bear the burden of providing for its own or abandon altogether the 
struggle to preserve our cities, which historically have been the cradle 
for progress in the country. 

I am not prepared to abandon this cause nor do I believe the 
members of this Board are. 

We must continue to pursue aggressively the often elusive Federal 
and State dollar in order that we may shore up our sagging resources. 

We must continue to cut our budgets of all but the most essential 

3 - 

programs so that we will have the money to pt^ovidc the necessary police 
and fire protection, the necessary educational programs for our children, 
the necessary revival of our slums, the vital housing for our poor. 

Despite the unchecked national inflation and a sagging economy, and 
despite the absence of the massive help from the Federal and State 
governments, we have managed to keep San Francisco alert and alive in 
this difficult period. 

We have not fired teachers or policemen, or closed down parks, or 
made across-the-board layoffs of City employees, which would only 
aggravate the unemployment problem and reduce those services vital to 
the well-being of the City and its people. 


The economic health of San Francisco is basically sound because the 
City has encouraged economic growth. 

An indicator of this health can be found in the boom in construction, 
the rise of property assessment by nearly $67 million this past year, and 
the jump i n new residential: valuation to nearJy S5S million. 

There is a new and encouraging thrust forward in downtown develop- 
ment with nearly $1.6 billion in new office buildings, hotels and 
redevelopment projects either completed or planned. 

This development has become increasingly controversial in San 
Francisco yet is the envy of every big city mayor in the nation. It is 
envied by city governments that recognize with active business development 
comes thousands of jobs, that with active business development there is 
removed the specter of block after block of deserted store fronts and 
deserted downtown streets. 

_ II - 

We should be heartened by the willingness of the business community 
to make these investments for it shows clearly its faith in the 
solvency and future prosperity of our City. 

The impact of this economic transfusion into our civic arteries 
is nowhere more evident than in our unemployment rate which continues 
below both the state and national averages. 


The basic portrait beauty of San Franciso has not been sacrificed 
through this building boom. We have soaring buildings and magnificent 
plazas where once we had squat, ugly and rundown old stores. 

We must remember that everything tall is not necessarily ugly and 
everything squat necessarily beautiful. 

High-rise construction has been contained in the downtown financial 
area while at the same time we have imposed a MO-foot height limitation 
along the entire San Francisco waterfront from Pier 9 to Aquatic Park to 
preserve the great natural beauty of that vista. 

Our environment i's the true heritage of San Trancisco and ^h^c 
administration and this Board of Supervisors have a clear mandate from 
the people and have made a clear personal commitment to its preservation. 

San Francisco is taking rigorous new steps to clean up its environ- 
ment, but without massive government assistance the task will never be 
more than half done. The protection of our bay waters is an example. 

We have already passed a $65 million bond issue to combat water 
pollution, have enacted perhaps the toughest local ordinance in the 
country in an effort to halt pollution of San Francisco Bay, and passed 
a sewer service charge which hopefully will provide another $13 million 
a year to this commitment. 


- s 

But there is a limit to what local funding can rcasonahly bo asked 
of the public at a time in history when our City, like the other major 
American urban centers, is in the grip of the inflationary crunch. 

Our City engineers estimate that we need $500 million to correct a 
major deficiency which plagues many of the older eastern cities. San 
Francisco has a combined sewer system which is badly overburdened trying 
to handle both sewage and storm drainage. 

During dry weather, we are bringing the problem of sewage treatment 
under control. Our three primai'y treatment plants are being upgraded 
to include chemical treatment in addition to primary treatment of sewage. 
This is now in operation at the -North Point plant and is scheduled for 
completion later this year at the Richmond-Sunset and Southeast plants. 

At the same time, we have expanded our monitoring programs for 
industrial plants through implementation of our new Industrial Waste 
Ordinance adopted last January. 

However, our capability for treating the flow into the Bay is 
severely taxed or rather overwhelmed during the rainy reason when the 
outflow reaches nearly 50 times that of the 100 million gallons a day 
during the dry season, 

A comprehensive program developed by our planners indicates that 
full treatment of the rainy season outflow can be accomplished through 
the construction of a major treatment plant, deep storage areas, and a 
connecting tunnel system. 

No treatment plant is capable of handling the daily flow during 
the heavy storm season. But a system of storage areas could be utilized 
to temporarily hold the flow and then pump it through the treatment 
plant at a later time. 

This $500 million program is the only realistic approach to this 

- 6 

problem. ScparaLJun of our present sewer system would cost a staggering 
$2.5 billion. 

Our local commitment of funds to water pollution control is already 
strained. The $13 million estimated revenue from our sewer service 
charge will only pay for maintenance and operation of our present system 
and redemption of our 1971 bond issue. 

What is required is a city-state-Federal funding partnership to 
eliminate what is clearly a regional problem. Funding of this nature, 
up to 80 per cent of the total cost, is now available for dry weather 
treatment, but is not available for combined systems. 

A review of our most recent efforts to improve the quality of 
San Francisco's environment clearly shows that we are paying more than 
lip service to ecology. 

San Francisco has been the leader in the freeway fight against the 
world's most industrious and toughest lobby, the automobile. Our City 
is not being ribboned with concrete nor will it so long as we persist in 
our conviction that fi'eew^ys gu underground or not go at all. 

Vacant lots overgrown with weeds have been converted from neighbor- 
hood trash dumps to neighborhood mini-parks. Nineteen are now completed 
or underway and another 14 are planned. 

We have landscaped more than 250 additional acres of public lands 
and planted over 13,000 trees on our streets. Further landscaping and 
development of new recreation facilities is underway in the undeveloped 
areas of McLaren and Golden Gate Parks. 

These are people parks and more than 8% million citizens made use 
of them last year, not counting other millions who enjoyed the beauty 
and variety of Golden Gate Park. 

- 7 

Another park is springing to life nearby in Mountain View where 
San Francisco is now trucking its solid waste garbage to fill in the 
544-acre park site. 

San Francisco's true commitment to the preservation of our environ- 
ment was dramatically underscored with the preservation of 23,000 acres 
of San Francisco watershed property from commercial development and 
exploitation, through a two-county agreement. Many thousands of acres 
of that property are now being transformed into a regional recreation 
area; the rest will remain in its natural wild state. 

Market and Mission Streets, historical boulevards in this City, 
are springing to new life under a program of Federal urban beautif ication 
which we lobbied out of the halls of Congress. 


The distinguished former Attorney General of the United States, 
Mr. Ramsey Clark, in pondering the nation-wide increase in crime, con- 
cluded that it thrived on: 

"... the utter wretchedness of central city slums, crammed with 
most of the sickness, poverty, ignorance, idleness, ugliness ... its 
residents impotent, incapable, incommunicado and physically isolated ..." 

We recognize the existence of these problems in San Francisco and 
have attempted to bring to our poor and underprivileged a sense of hope 
that the blight and decay of their physical surroundings and their lives 
can be removed. 

The calm that pervades our neighborhoods can be traced to the 
tangible results which the people have been able to see. 

At the forefront of the movement to restore dignity and beauty to 


- 8 - 

our blighted slums has bean the Redevelopment Agency, which has recently 
suffered the loss of its distinguished and talented director of many 
years, Mr. Justin Herman. 

Justin left us a J egaey of neighborhoods springing to life with a 
dramatic burst of new building. 

The beginnings of a new city can be seen flourishing on a hillside 
in Hunters Point where old, condemned housing is coming down and new 
housing rising with at least half of the work being perfomed by residents 
of the community. 

Hope and housing have been the product of energies devoted to the 
development of Banneker Homes, Martin Luther King Square, Prince Hall 
Apartments, the Friendship Village complexes, and the Western Park 

Again, however, we are stymied to a large degree by the failure of 
the present administration to commit fully to the concept that every 
person should be able to obtain decent housing. 

We have xoughr the federal government, even resurLlny to lawsuits 
in the courts, to break loose the funding necessary to go ahead with 
another 3,000 units of housing. Our efforts have met with some success, 
but we have yet to be able to awaken in Washington a total recognition 
of the importance of filling this need. 

The revitalizing force of redevelopment is being felt in San 
Francisco's entrenched skid row, the South of Market Street area, through 
the creation of the Yerba Buena Center. 

This is a $200 million effort to restore and rehabilitate an entire ■ 
downtown area, to replace slum buildings with vital new businesses*, "to - 
clear out rat-infested alleys and build new urban open spaces, to 

- 9 - 

replace tax write-offs with development that contributes its share to 
paying San Francisco's tax bill. 

A good deal of San Francisco's subsidized housing will be supported 
through revenues from from Yerba Buena Center, which will also boost our 
vital tourist industry and provide 30,000 construction and permanent jobs. 

Funding has been difficult, but when we view the success of such 
renewal projects as Embarcadero Center, Diamond Heights and the India 
Basin Industrial Park it has been an effort clearly justified. 

This administration has attempted to couple with the physical 
revitalization of the neighborhoods a social renewal of the people's 
spirit directed first at opening channels of communications with the 
people to bring them directly into the mainstream of our urban life. 

The expansion of that communication has fallen under the direction 
of the Mayor's Office Deputy for Social Programs, who serves the function 
of an ombudsman for the poor in addition to the important role of 
developing programs ranging from hot meals and reduced bus fares for 
the aged to summer youth jobs and manpower training. 

We have opened the door to top echelon, policy-making government 
jobs to minorities, doors which were sealed shut for so many years. 

We have encouraged the development of a New Careers Program, the 
establishment of youth councils in every area of the City. We have 
initiated rent assistance and relocation programs for people displaced by 
redevelopment . 

With $7 million in hard-won Federal money, the Model Cities 
programs for the Mission and Hunters Point-Bay view are underway with the ■ 
promise of better educational programs, more jobs, day care centers and 
other new social programs. 

- 10 - 

But the hard facts arc that even this is insufficient to truly 
cure the deep-rooted problems of our slums. 

Again, in the words of Ramsey Clark, "The solutions for our slums, 
for racism, for crime itself, are basically economic." 

Providing adequate health care for our people is as good an example 
as any of the economic restraints we feel in attacking this problem. 

We arc building a new general hospital. We have constructed five 
neighborhood health clinics. We have initiated new preventive health care 
programs . 

But still many of our people are sick and unable to obtain quality 
health care. 

The three big urban diseases—drug abuse, alcoholism, and venereal 
disease—are rampant. 

We have insufficient medical personnel and our health facilities 
are outworn and overburdened to fully meet these community health 

In some of our poor neighborhoods, we could probably utilize a 
program of clinics as widespread as our fire stations. 

In some of our neighborhoods we could use an army of door-to-door 
medical corpsmen where now we have only a few dedicated doctors. 

The failure of our urban poor to gain access to adequate health 
care is certainly related to financing, and National Health Insurance 
if adopted will provide major therapy. 

But more extensive government help may be required to solve our 
big city health problems unless there is expanded activity in the 
private sector. 


Wo may be nearing the moment when the Federal government will have 
to become the "doctor of last resort" much as it now serves the role of 
the "employer of last resort." 


Nowhere in city government has the need for financial assistance 
been more dramatic than in law enforcement. 

Crime is truly a national problem, not confined to the simple 
boundaries of a city or even to a region. 

San Francisco has its full share of it, more than some cities and 
less than many others. 

We have made significant headway in the fight against the national 
trend of rising crime. In the last fiscal year, our major crime 
offenses were down by well over 8 per cent. This actually means that 
8,534 fewer major crimes were committed in that year. 

Under the outstanding leadership of former Chief of Police Alfred 
Nelder, an aggressive new attack was mounted on the hard-core crimes 
and a program of professional upgrading of officers inaugurated. 

The Office of the Mayor and the Board of Supervisors back-stopped 
that program with increases in the police budget of nearly $11 million, 
with a 40 per cent increase in equipment. 

The patrol force was strengthened with 120 more uniformed officers 
and foot patrols were reestablished in several neighborhoods. 

With financial assistance from Federal grants and additional man- 
power, the department has improved policy-community relationships 
through new programs and direct involvement with the people of our 
neighborhoods . 

- 12 

Many innovative programs have been launched, including the use 
of helicopters, the Golden Gate Park "scooter squad", new instantaneous 
personal communication systems for walking patrolmen, new automated 
information systems, and others. 

All of these, coupled with dedicated and hard-driving work by our 
officers, have helped blunt the attack of crime and the criminal element 
in San Francisco. 

These are but a few of the major, areas of City government which 
concern my office and your distinguished Board. I have not gone into 
detail here but rather am forwarding to you the full reports of each of 
the City departments. 

But I believe this is a fair summary of the situation facing the 
people of San Francisco today. 

We have social and environmental and financial problems, which are 
being attacked with new approaches and new programs. 

I believe they can be solved, but not without the Federal and 
state assistance which is clearly due the cities at this particular 
moment in their struggle for survival. 

We ask for nothing that we already az^e not providing to these 
governments. What we ask is that more of it -- more of our people's 
money -- be allowed to remain in our cities where we know what the problems 
are and we believe we know the solutions. 

I would urge this Board to join me in continuing to press through 
every means at our disposal for tax relief from the state and 
revenue-sharing from the Federal government. 

Without it, my optimism for San Francisco and for all our cities 
diminishes . 

U. 11 11 


\J\Z, C i October 2, 1972 

.. . ' ' 

The Honorable 

Board of Supervisors 

Room 235, City Hall 

San Francisco, California 91102 

Ladies and Gentlemen: 

San Francisco of the 1960's was a City hopelessly adrift in the 
storm's eye of the urban crisis. 

It was battered by the violent winds of social unrest and com- 
munity upheaval and many despaired for its survival. 

Among the great cities of the world, San Francisco's claim to 
greatness was no longer freely accepted. 

For many years we had taken fierce, sometimes even smug pride 
in our City as cosmopolitan and sophisticated, uniquely free from the 
industrial squalor of a Pittsburg or the ghetto unrest of a Newark or the 
neighborhood decay of a Cleveland. 

Yet the 1960 's proved beyond question that we were subject to 
many of the same torments and miseries of other big American cities. 

Hunters Point was added to the roll-call of urban riots and the 
campus revolts and violence came to San Francisco State. 

The Haight-Ashbury, once remarkable only as a typically quiet 
and friendly San Francisco neighborhood, exploded into international 
prominence with its narcotics traffic. 

Street crime soared and in the Sunset, the Mission, Noe Valley 
and a dozen other neighborhoods merchants did a brisk new business in 
watchdogs, police whistles, hand-guns, and double-latch locks. 

Sit-ins, demonstrations and marches on City Hall became 
every-day events. The tax rate shot upward sharply. Businesses closed. 
The physical decay of Market Street and Western Addition and Hunters 
Point went unchecked. Racial tensions were ragged and raw-edged. The 
atmosphere in city government was crisis-dominated. 

The people of San Francisco, the members of this Board, and I 
all shared that trying voyage. We shared common fears for the future of 
our City and its people and a common struggle to preserve this City's 

Today, under mandate from the City Charter, I am required to 
inform this Board of what I believe to be the State of the City of San 

- 2 - 

Instead of a statistical litany of last year's departmental 
activities, accomplishments and needs, I believe we have reached a point 
in time when we should step back and view San Francisco in some more 
meaningful perspective. 

The time has come for us to take stock of where this City has 
been, where it is today, and where we hope to see it go in the future. 

I believe San Francisco is finally emerging from a chaotic 
chapter in its history when it was not in control of its own destiny, 
when both its government and its people were captives of events rather 
than masters of this City's fate. 

We have moved from that frenetic phase and the City has regained 
some sense of stability and self-control. 

It is no longer a question of whether San Francisco will survive 
the urban crisis; it is doing so. 

Crime is down, taxes down, our ghettos are rebuilding them- 
selves into neighborhoods. Our campuses are about the serious business 
of inquisitive education. 

Now is the moment when we must respond to these demonstrable 
gains by consciously throwing off any lingering sense of panic and crisis, 
and by freeing city government from the knee-jerk responsiveness of the 

It is a time to chart the future of this City out of a sense of 
reason and not simply reaction. It is a time to recognize that crowds 
mobbing our offices or demonstrating at our doors do not necessarily 
carry the message of the public majority or the public good. 

To be sure, many of the issues of the 1960's are still before us. 

Public safety, taxes, the economy, neighborhood improvement, 
employment, racial tensions and environmental protection are not likely 
to diminish in importance or require less of our time, commitment and 

But it should also be clear that many of these problems are 

being met" with success and public resources are being applied to them with 

increasing effectiveness, despite the nagging and carping of those who 

persist in nitpicking individual failures. - ' - -'. 

Crime on the streets. of San Francisco is being brought under 

control. The seven categories of major crime have been reduced overall 

- 3 - 
by 20 per cent from last year and the trend continues downward. Four of 
those categories -- robbery, burglary, aggravated assault, and auto theft — 
are now below even the 1967 levels. 

Yet we ail recognize that we must continue to strive to restore 
the sense of neighborhood safety which existed 20 years ago in San 
Francisco. We all recognize that many San Franciscans still feel a sense 
of insecurity on our streets at night. 

Significant improvements have been made and are continuing to 
be made in the physical and social quality of life in Hunters Point, the 
Mission, Western Addition, and many of our other neighborhoods. 

Yerba Buena Center, which will provide nearly 30,000 jobs and at 
last erase the blight of South-of -Market , is finally nearing reality. 

The property tax rate in San Francisco has been reduced for two 
straight years. We have applied rigid new controls on spending, meaning- 
ful programming of our resources, and have forced departments to accept 
new accountability for expenditures. 

We have greatly expanded and updated much of our park system, 
which is now finding thousands of new users. San Francisco has been 
checkerboarded with 19 new mini-parks for our neighborhoods and more are 
planned. New lighting systems will provide expanded use of this rich 

Our young, elderly and poor are receiving better and more health 
care as a result of imaginative planning and new delivery systems 
initiated by our Department of Public Health. 

We have launched a very aggressive war on the drug traffic, which 
is being waged on a number of fronts and presently have before the Board 
a new $1.3 million program for further expansion. 

Racial tensions have been reduced in San Francisco due largely 
to increased minority representation in government at both the policy and 
operational levels. A conscious effort has been made to make government 
more aware and responsive to the problems of employment and housing, two 
acute needs among our minorities. 

Many of these programs have not been accomplished without 
difficulty and perhaps Model Cities is a classic example. 

Operating for the past year, the Model Cities program in 
Bayview-Hunters Point and the Mission has been a positive experience. 

- "•! - 
The program has generated over '100 new jobs for residents of both 
communities. As a result of the manpower program, over S00 Mission 
residents have been placed in private sector jobs. In education, more 
than 1,000 youngsters from both areas have been affected by special 
education and recreation programs operated under Model Cities. 

Housing Development Corporation activities in both neighborhoods 
have resulted in bank agreements that will provide $3 million in home 
repair loans. The Community Defender program in Hunters Point, just 
recognized nationally as one of the country's best, has provided legal 
services for nearly 300 residents. The Mission Language and Vocational 
Center has been similarly honored. The Food Supplement project has 
distributed more than 2,000 nutrition supplement packages to pregnant and 
nursing mothers and their children. 

Even with these successes, however, it has been a year of 
struggle. The entire program has had to address the difficult task of 
developing administrative capacity in this complex and comprehensive 

It has been a year of experimentation, testing, and indeed 
"demonstration," which is what the program calls for. Not all of the 
experiments have been successful. The management capability in several 
projects has been lacking and we are now moving to correct these problems 
with the experience gained through the first year's operation. 

We must give those who have not had the opportunity to share in 
decision-making the chance to assume some authority over the issues that 
affect their lives. For people who historically have not had the chance 
for this responsibility, there must necessarily be a growth period. This 
program is designed specifically to provide that opportunity and the 
capabilities learned now will remain in these communities long after 
Model Cities funding ceases. 

There will be mistakes in this period, but I have confidence in 
the program's future and its value, despite those who seem intent on a 
fatal blow to it. 

It is precisely programs of this nature which have required so 
much of our day-to-day energies and attention. But it is precisely 
programs of this nature which helped San Francisco survive these past 
years of social turbulence. 

- S - 

The moment has now come when we must look beyond these immediate 
problems and solutions and take the initiative in planning comprehensive 
courses of action on far broader fronts. 

We must seek: 

--A vigorous new attack on the problems of unemployment and 
economic development in San Francisco. 

--Greater streamlining of city government and greater profes- 
sionalism in our civil service and in decision-making. 

--New programs for the physical and social preservation and 
restoration of San Francisco. 

— Meaningful tax reform and truly safe streets. 

— Revitalization of our public schools. 

— Improvement and expansion of our transportation systems. 

There are many specific programs we can address ourselves to in 
the immediate future as we pursue these broader goals. 

Immediate priorities in seeking fuller employment for our people 
and renewal of the physical quality of our community should be the prompt 
development of Yerba Buena Center, the India Basin industrial project, 
our Port both in terms of commercial and recreational expansion, and 
replacement of our sewer system. 

Many of these developments have a meaningful impact on both the 
economy and employment picture but also in terms of improving the 
aesthetic quality of San Francisco. 

In this category falls my belief that San Francisco should commit 
itself to the construction of a new Center for the Performing Arts. 
Thousands of our young are plunging into the cultural life of San 
Francisco in numbers that now strain the capacity of our halls and 
centers. Culture in our City is no longer a plaything for the rich. 
Rather it has truly become a people's culture. 

Construction of a new Performing Arts Center would open the door 
for some 250 additional performances each year and another 600,000 spec- 
tatoz's now denied access to much of the cultural richness of our City. 

A realistic program for funding construction of the center can 
be managed through the set-aside of $1 million a year in City monies for 
the next five years with the remaining required funds to be raised by 
private subscription. 

- 6 - 

I suggest that the Board could both encourage that subscription 
and protect its investment by requiring that the total $5 million city 
share be matched by $12 million in private funds by the end of the 
five-year period or the municipal share reverts back to the City. 

Property taxes, despite significant decreases in San Francisco 
for the past two years, remain a constant source of concern for the people. 

I believe we must face up to the realization that the State of 
California, which has promised so much and delivered so little in this 
regard, must be finally ruled out as the source of any true tax reform. 

We have pleaded for years for the State to do something about the 
inequitable burden of our taxation system. All we've ever received in 
return is a glassy stare from the Governor and a cold handshake from the 

If we want property tax relief in San Francisco, we are simply 
going to have to do it ourselves. 

We have gained the experience over the past several years of 
better marshaling our resources and controlling spending. 

Our analysis of the fiscal situation in San Francisco, market 
trends, and the economic condition of the country indicates that further 
reductions in San Francisco's tax rate are possible. 

I believe the Board should not pass next year and I should not 
approve any tax rate ordinance which exceeds $12.25, which would mean 
another reduction of at least !<■'.$ over the present rate. 

Again, our experiences over the past several years indicate that 
a close working relationship and cooperation between the Board of 
Supervisors and the Mayor coupled with sufficient advance planning and 
time can result in significant tax reductions. 

I believe we should also adopt as a resolution of purpose a 
program to further reduce each year's property tax rate by a minimum of 
25C until the rate falls to $11 per $100 valuation. On the realization of 
that goal, the rate should be fixed as an absolute ceiling. 

In the field of transportation, we should address oux^selves to 
improvement of the Muni and the exploration of whether a successful 
experience with BART will require connecting systems to the Richmond, 
Sunset and Hunters Point districts. In other areas of transportation, I 
believe we would very well see this year a decision made for replacing 

- 7 - 
the Embarcadero Freeway with an underground link to the Golden Gate 

We must begin to restore the reputation of our public schools. 
Encouraging steps, such as the elective school board and new internal 
leadership, have already been taken, but much remains to be done. 

At the heart of these programs is a major internal restructuring 
of government which must be accomplished before we can expect any lasting 
success on any of these fronts. 

We must develop the ability to evaluate issues in depth so that 
the implications of our actions are clearly understood and the advantages 
and disadvantages carefully balanced. 

We cannot make environmental or developmental decisions, to cite 
the most frequently used example currently, without regard to the con- 
sequences of these actions on each other. 

It is this very sort of careful planning and evaluation which is 
inherent in the requirements of the Urban Design Plan, which sets 
thoughtful parameters on height and bulk that will best accommodate the 
competing demands of both aesthetics and economic development. 

The increasing complexity and changing relationships of the 
City-Federal government relationship also require that we formulate new 
decision-making processes aimed at better establishing spending priorities 
and programs. 

We have calculated that over the next five ayears, San Francisco 
will receive $109,372,000 in Federal revenue sharing funds. If the Board 
of Supervisors and the Office of the Mayor in concert plan its use care- 
fully, San Francisco will be able to make major inroads on some of our 
more pressing problems. 

The effectiveness of this program is directly related to the 
quality of our civil service and our decision-making capabilities. 

In our Civil Service, we have already initiated programs to 
significantly upgrade the quality of our employees through new incentives, 
additional promotional opportunities and programs for educational advance- 

On the planning front, we are developing new budget procedures to 
more effectively control government spending and to avoid duplicative 
spending through the reordering of our budgets into categorical 


We are developing planning staffs within the Office of the Mayor 
to program for new Federal funding and develop comprehensive, long-range 
programs for community and economic development in San Francisco. 

San Franciscans probably lead the nation in being the most vocal, 
concerned citizens when it comes to the future of their City. 

We cannot toy lightly with that future. We can no longer make 
decisions concerning its future in an atmosphere of emergency reaction 
and crisis politics. 

Future decisions by the Board will involve great sums of money 
and set directions for our City for a great time to come. 

We must recognize the increasing complexity of issues and make 
certain we are equipped to understand them fully and prepared to make 
decisions which reflect careful consideration of values on both sides. 

Improving management and policy-making procedures arc not ends 
in themselves. After all, in the final analysis, it is the result that 

In the end, they must add up to a better City and a better life 
for all those who live here. 

S_incerely , 

/Joseph L. Alioto 
' Mayor 

Saw Francisco 

October 1 , 1973 

The Honorable 

Board of Supervisors 

Room 235, City Hall 

San Francisco, California 94102 

■-HBLI^ . i 

Ladies and Gentlemen: 

In the heavy atmosphere of Watergate, depleting resources, unemployment, 
concern over threats to the environment and rising costs, it is easy to be 
pessimistic when discussing problems of our cities. There are many who find it 
difficult to be optimistic; some have formed a habit of predicting disaster and 
can only be gloomy about the future. To be sure our cities still have some severe 
problems to solve. There are crucial issues, some old and some new, that will tax 
our energies and our patience. 

In spite of this, I believe we can justifiably feel optimistic about the 
future in San Francisco. San Francisco, perhaps better than most cities, has 
weathered the urban crisis of the 1 960 ' s . We have now reached the point where we 
can take the initiative to solve problems before they get out of hand. If we 
give in to pessimistic thinking we may fail. 

I spoke last year of a reduction in major crimes. This continues to be 
true; last year the overall crime rate was down 19%. This year the trend continues 
with a further 2% reduction. Much of this is due to fine police work. I attribute 
a great deal of the credit also to the concern of diligent citizens and to the many 
programs that we have which are aimed at the root causes of crime. 

Unemployment, a major concern in most cities, remains at about the same 
level as last year. The fact does not cause us to rejoice but, on the other hand, 
the fact is significant considering what is happening to the economy. Were it 
not for the fact that we have maintained a high level of carefully-planned, 
essential development in San Francisco the unemployment figures could be much higher. 
But our efforts have not been limited to new construction jobs. We have also worked 
to upgrade the unskilled labor force through job training programs and we have made 
good progress in eliminating discrimination in hiring. The Human Rights Commission 
deserves much of the credit for the latter. 

Paae 2 

He are also working to maintain the jobs that are here. We have had some 
productive meetings with Federal agencies and we have secured some very promising 
commitments from the Federal government to help us retain the jobs at the Hunters 
Point Naval Shipyard which the Ma vy intends to close down. I am confident we 
will be able to replace most of the jobs that will be lost by the closing of the 
Navy yard. 

We now have, in the Office of Economic Development, a skilled staff working 
full time on the retention and expansion of labor intensive industrial plants and 
businesses in San Francisco. The staff is also working on a City-wide survey of 
potential sites for new industry. This will be followed by an intensive effort 
to attract tenants. 

The pending end of the Emergency Employment Act can mean the end of work in 
City government for some 700-300 persons, unless there is an extension of that 
legislation, which looks very uncertain at this time. The loss of those services 
to City government will be very serious, for extremely useful things have been 
done in the health field, forsenior citizens, and for returning Vietnam era 
veterans. The only alternative would be to add positions to City staff, a prospect 
not being contemplated due to the effect on the tax race. 

On another front, we look forward to the opening of BART, one of the 
finest achievements by any government or group of governments since the turn of 
the century. We should remain steadfast in our original conviction that a regional 
transit system is a better solution to the urban transportation problem than 
improvement to accommodate the automobile. While others were just talking about 
limiting the use of automobile we took steps in the early sixties to do something 
about the pollution problem, the congestion problem and, most of all, the high 
cost of accommodating the automobile. 

Recognizing there is still much to be done, our municipal railway is still one 
of the best municipal transit systems in the country in terms of service and price. 
San Francisco has faced up to the fact that a public transportation system is going 
to cost, not produce revenue. Some critics perhaps look back to the early 1900's 
when we had several independent transit systems, all making money. Those days 
are gone forever. 

Page 3 

We have made a significant commitment to improve and maintain the Muni. 
I believe this is the only realistic and proper way to respond to the problem 
created by the automobile and still meet the City's transportation needs. For 
years the Muni has been deprived of an ability to upgrade its services and equipment. 
That trend has been changed and we expect, within the next 2 years, to operate a 
wholly new streetcar system, new electric buses, and new yards and maintenance 

On another transportation front, we have a breakthrough comparable to the 
so called freeway revolt of 1965. Late last month an official of the U. S. Depart- 
ment of Transportation said publicly that it is entirely feasible that Federal 
funds could be used to help tear down the Embarcadero Freeway and that the Federal 
policy on underground routing of freeways is changing. It seems that our efforts 
to convince Federal and State officials on the merits of undergrounding inner 
city freeway connections has begun to pay off. 

I spoke last year of our efforts to improve our Civil Service System. 
Earlier this year the Grand Jury praised the progress that has been made during the 
past 18 months. The number of so called "limited tenure" jobs has been cut by 2000 
in a year's time. Examination procedures have been speeded up. There has been a 
significant increase in the hiring of minorities into Civil Service and good employees 
are being recruited. I am pleased with the year's accomplishments. 

The Yerba Center project, stalled so long in the Courts, is at last moving 
ahead. I continue to. be optimistic about its success. The support of the Board 
of Supervisors, the Chief Administrative Officer, other City officials, the Federal 
government and, I believe the majority of the citizens of San Francisco, attests to 
the improtance of this project for the future of San Francisco. 

We have had a number of labor strikes but most have been resolved in time 
to prevent serious disruption of public service or inconvenience to the public. I 
am confident that those strikes now in progress will soon be ended. In San Fran- 
cisco labor and management can sit down together and talk because we have made a 
favorable climate for it. Reasonable men and women can always get together and 
work out any differences if they are given the right opportunity. 

Page 4 

Last year I observed that we had reached a turning point in our struggle 
with urban problems; that we could now turn our attention and energies to more 
permanent solutions. This we are doing. Jobs, housing, health, safety - these 
continue to be urgent issues and we must continue to deal with them relentlessly. 
We should also give attention to the equally important cultural opportunities that 
make life meaningful and fulfilling. I proposed last year that we needed a 
performing arts center. I am happy to say that the Center is on the way to becoming 
a reality. 

I am pleased also that the Board of Supervisors has approved an expanded 
neighborhood arts program that will enrich the lives of many citizens and will 
enable many talented persons to gain experience and recognition. 

The City responded to the need for additional funds to support the multitiK 
of other artistic ventures in the City that do not need a new facility but are 
springing up in garages end churches and basements and parks throughout the City. 
San Francisco is unique in having this great wealth of cultural life at all levels, 
from street corners to the Opera House, and we have begun to take the initiative in 
preserving what we have, improving the cultural facilities where possible, and 
encouraging neighborhood arts throughout the City. 

Not long ago we announced that we were working on a new waterfront walkway 
from Fort Point to Fisherman's Wharf. Much of the northern waterfront has been 
closed to the public for years. But I am pleased to say today that, through the 
initiative of the Mayor's Office and with the cooperation of the Army, the National 
Park Service, our Planning and P>ecreation and Parks Departments, portions of the 
Golden Gate Promenade will be open for public enjoyment within a few weeks. 

We are working on another community improvement that I expect will be a 
major part of our Bicentennial Celebration in 1976. This is a program for the 
retention and restoration of fine San Francisco Victorian architecture. We have 
already seen what private initiative can do in restoring other parts of the City. 
We would like to see similar efforts made throughout the City, in areas such as the 
Mission. Some of our most historic buildings are located in the Mission District 
and citizens are enthusiastic about working with us to preserve them. 

There are many other topics I might discuss but there is one in particular 
that I would like to concentrate on in this message. This has to do with efficiency 
in budgeting and management. 

Page 5 

For the third year in a row we have lowered the City's tax rate, and 1 
convinced we can continue this pattern of annual reductions, lie have, as a rotter of 
fact, simultaneously reduced the parking tax, the sewer service charge, and the pro| 
tax. To do this at a time when we are getting little or no help from the State and 
fewer Federal dollars would seem to he an impossibility. With careful management, 
however, it can be done. 

Last year I said that we must work toward improving fiscal management and 
control on spending. This was no idle statement; a number of significant actions 
have been taken and I am proposing to take others. 

The receipt of the first General Revenue Sharing in 1972 created the 
illusion to some that the City had new money for extraordinary purposes. Actually, 
as you know, the City had altogether fewer Federal dollars last year than it had in 
either of the two previous years. Just as we won our victory with the passage of 
General Revenue Sharing, the national administration began using what was supposed 
to be new money as a substitute for far more dollars that they cut back in 
categorical programs. 

With General Revenue Sharing we went through a new experience in progra 
local resources and expanding budget procedures. A great deal of time was devoted, 
particularly in the Mayor's Office of Community Development and the Department of City 
Planning, to developing priorities based on City policies. From these priorities my 
office. reviewed requests for General Revenue Sharing funds from individual City 
departments, and we took that program to the people for their review and comment. L'e 
revised the program based on citizen comment and presented a recommended program to 
your Board for enactment. 

I think we can take justifiable pride in the amount of involvement of the 
citizens of San Francisco in this process. Frustrating as it may have been for those 
whose projects were not funded this year, their efforts were not wasted. What was 
developed was an important new procedure for providing a single focus for budget 
decisions and opening that process to more complete citizen participation. San Tran- 
cisco's experience in General Revenue Sharing has been cited nationally as an e: 
of how priorities can be used in allocating money. Citizens are just as interested in 
how the government sets priorities as it is in how the money is finally spent. 

As I said earlier, I am determined to press toward further tax rate reduc- 
tions. At the same time I am equally determined to support vital local programs, both 
those that benefit the City as a whole and those that can improve the quality of the 
residential environment of San Francisco's neighborhoods. 

Page 6 

On the surface this seems impossible, especially in light of decreasing 
state and federal funds. With careful odering of priorities and improved fiscal 
management, I believe it can be done. Without careful management, our tax rate 
reductions will be chaotic, unrelated to needs and long-term objectives, and 
ultimately short-lived. At this tlme.with three years of successful tax rate 
reductions behind us, we have to institutionalize a system that can provide San 
Franciscans with the best in municipal services and continue to bring down the 
tax rate to a more reasonable level. 

In the near future the Congress is expected to adopt a block-grant approach 
which will consolidate funds for such programs as urban renewal, code. enforcement 
and open space. This change in Federal funding will require a San Francisco program 
for the use of community development money. We have begun to work on that program. 
This is a major change in federal-local relations. It most surely means we must be 

prepared to evaluate, manage and make policies in ways different from previous 
years. A program of this sort will require new forms of cooperation between the Mayor 
the Board, and City agencies involved in community development. The Citizens .Cormiittoj; 
on Community Development, a committee which I appointed in 1971, will also be 
involved in the preparation of such a program. It will be the beginning of a more 
coordinated approach to allocating funds for community development. 

The Community Development staff in my office provided technical assistance 
this year in the allocation of General Revenue Sharing funds. The experience gained 
from that endeavor is already being applied to developing and improving procedures 
for planning and coordinating community development efforts, particularly in 
assessing both immediate and longer term priorities. 

We are moving ahead on other aspects of inoroved fiscal management. The 
Board of Supervisors joined with me this year in approving four new positions to 
start a pilot program on so-called "program" or "performance" budgeting. Qualified 
persons are being sought now to fill those positions. The purpose of this effort 
is, as you know, to improve efficiency in budgeting, to generate better budget 
information, and to make possible wiser decisions on alternative courses of public 

Pege 7 

The City is also beginning to appreciate the need For effective evaluation. 
Until recently we had no way of objectively analyzing the successes or failures of 
public activities. 1 would like to recognize the very significant work done by the 
Budget Analyst for the 3oard of Supervisors, ','x. Rose. The management audits he 
has performed have already saved the City substantial amounts of money. I hope 
that a person equally qualified can be found to replace Mr. Rose when he leaves 
San Francisco to assume his post as Auditor General for the State of California. 

In August, I issued a memorandum to all City departments and agencies 
announcing the establishment of a Fiscal Policy Conmittee. This Committee is now 
assisting me in evaluating budget requests and long-term fiscal policy matters. In 
that August memo I indicated to the departments that it is my intention to strictly 
control the approval of supplemental budget appropriation requests and I presented 
some interim guidelines for evaluating supplemental appropriation requests. I know 
the Board concurs in this action. 

Our goal is realistic budgeting. This requires a commitment by City 
administrators, my Office, and the Board. This was recognized in a recent report 
submitted to me on measures to improve budget management and control. The report 
was completed, at my request, in cooperation with a committee of top City officials. 
In line with that study I believe: 

The Office of the Mayor should issue annual reports that provide guidelines 
for the allocation of funds for major community improvement programs. 

A central control and clearinghouse for state and federal funds should be 
established in the Mayor's Office to coordinate efforts to seek, administer and 
account for federal or state funding for local programs. 

Budgeting procedures should be initiated and enforced which would provide 
better budget information through reports, analysis and program budgeting; and more 
realistic budgeting by permitting greater administrative flexibility in budgeting 
but greater restriction on the use of supplemental appropriation requests. 

We should seek agreements from state and federal agencies to recognize local 
program planning and coordination efforts, to cooperate and assist with these 
efforts and to work for reforms in state and federal procedures that affect local 

Page S 

During the next sixty days I will forward to you, for your consideration, 
specific proposals designed to implement these recommendations. 

I think we should have a point of central review of applications for state 
and federal funds and a central place where information on state and federal funds 
and programs can be collected and disseminated. 

I will request authorization from the Board to seek additional federal funds 
to help with the implementation of those measures we intend to take to improve 
budgeting procedures. 

I intend to assign staff to work with federal agencies to develop a regional 
information system on the flow. of federal funds so that we can be provided more 
and better information on all federal grants being allocated through the region. 

Since the City's Comprehensive Plan provides a framework for basic City 
policy, I will ask the Planning Department to submit to me a statement of citywide 
objectives and policies in the areas of housing, transportation, and parks and 
recreation. This initial statement will give us the basis for evaluating program 
requests within these categories. 

All of these efforts are premised on the notion that we know what we need 
in terms of both technical and financial assistance from federal agencies. We 
therefore want to present federal agencies with our needs and requirements so that 
we are not saddled with requirements which are made for the convenience of federal 
agencies and are unrealistic when applied at the local level. 

Another request 1 expect to make of the Board is your cooperation and 
participation in working out uniform administrative procedures for handling federal 
and state grant applications for local public agencies. I will also seek your 
cooperation and participation in developing procedures for setting priorities, not 
only for projects to be financed from Federal and State funds, but from all sources. 

I should like to emphasize that all these efforts must be viewed in a 
long term context. They cannot be achieved in the lifetime of this administration 
or of this Board. Vie are talking about measures aimed at good government. When I 
leave this office, I hope the reforms and changes we have started will be ones 
that will endure, not because we started them but because they are good and useful. 
I know you are interested in these kind of improvements and changes. So, I ask 
you to join me today in working toward these goals. 

Page 9 

While I am committed to continuing to reduce the tax rate for San Francises 
I am equally committed to providing a high quality of new and continued coiimunity 
services and programs. It is a worthy goal. It can be achieved if we mobilize 
our efforts. It would lie easier to do one or the other. To do both we need to 
harness the best talents in City government and we must pay careful attention to 
both the substance of our budget, based on our priorities, and the budget process 
itself. This will cost something in time and staff,yet, it is economy in the Ion;; 

I intend to work, for the time I have remaining in office, to maintain the 
progress that we have been making since the turbulent 60's to concentrate on long 
term problem solving rather than crisis intervention. I cannot be successful in 
these intentions without your help and cooperation and the help and cooperation of 
all city department and agencies. I believe that members of the Co.ird are just as 
interested in and just as resolute as I am in achieving better fiscal control and 
resource management. Together we can make it happen. 

Sincerely, ' 

/ / Josqph L. Alioto 
[,/ Mayor 


Office of thf^JsAayor 


Joseph L.Alioto 

^ Ak.huuC H^4^.<l^C "*fe 

October 7, 1974 


The Honorable 

Board of Supervisors 

Room 235, City Hall 

San Francisco, California 94102 

Ladies and Gentlemen: 



Today's debate on the tax rate presents us with a timely 
and appropriate setting for a review of the immediate past history 
of San Francisco and a preview of the immediate challenges facing 

At the national level, we are finally surfacing from the 
political turmoil of Watergate. It has been a painful and pro- 
longed experience during which a national government fell and the 
Federal bureaucracy slipped into a state of near paralysis. 

Many important problems went unattended during the agony of 
Watergate, the most serious of which was the failure of the Federal 
government to deal effectively with the issues of inflation and 
unemployment, and the needs of America's cities. 

For the first time since World War II, we were faced with 
significant shortages and sharp price increases of such basic 
necessities as petroleum and wheat. Vital urban programs were 
stalled in the Congress or pidgeon-holed in Federal departments. 

This situation developed severe pressures on local govern- 
ment, and the vigor of our debate over this year's tax rate reflects 
our concerns for the effect of inflation on the cost of government 
and the added burdens on our taxpayers. 

I believe San Francisco has weathered this national economic 
crisis far better than most American cities because it came to the 
struggle in an essentially healthy economic state. 

We have made significant progress in stabilizing our tax 
rate, and in dealing with the real problems of unemployment, crime, 
housing and sound economic development. 

The Honorable, Board of Supervisors 
Page 2 

And despite the often postured and pretentious agonizing of 
our Cassandras, San Francisco today enjoys the reputation of being 
one of the world's most beautiful cities, with a quality environment 
unequalled in the United States. 

The state of San Francisco's health, granted the urban crisis 
remains, is generally good. Most Mayors in this country, who have 
numerous opportunities to make comparisons, agree that San Francisco 
has the best living quality among the nation's fifteen largest cities. 

•Clean air and fresh water, notably a problem in major cities, 
is no real problem here. 

We have a vital and beautiful downtown constantly renewing it- 
self while deterioration eats away the downtowns of many major 
American cities. The frenetic cries of "Manhattanization" subside 
as countless former critics become staunch converts to the amenities 
and open space of the Transamerica pyramid and Embarcadero Center, 
the two focal points for the emotional debates of a few years back. 
And those who accept Ada Louise Huxtable's judgment of the Seagram 
building on Park Avenue at 53rd Street in New York as an outstanding 
architectural triumph (as I do) probably would concede the architectural 
superiority of our own Bank of America Building. 

Our so-called ghettoes are building themselves into attrative 
neighborhoods with the intensive involvement of the communities. 

Our balanced public transportation system, with all that 
remains to be done, is admittedly the best and the most progressive 
in America and charges over-all the lowest rates. 

Crime, which is on the increase throughout the country, has 
been checked here, but much remains to be done to restore levels at 
least as low as those of 19S0. An intensive and highly motivated in- 
vestigation into all local law enforcement agencies by a federal 
strike force since March of 1971 has produced a minimum of scandalous 
police conduct. This affirms my own basic conviction that San Fran- 
cisco's Police Department has as high a standard of performance and 
honesty as any in the country. 

Social programs in San Francisco directed to bridging and 
then closing the gap between the various races living here have been 
partially successful, though admittedly our efforts to achieve a 
greater degree of social justice must continue unabated. The 
participation of large numbers of men and women from minority groups 
in the important decisions of municipal government, at all of its 
levels, has been and will continue to be the principal instrumentality 
for amelioration of the main social urban problem of our times. 

The Honorable 

Board of Supervisors 

Page 3 

Today, we face new challenges to strengthen, maintain and 
expand these gains. We have new responsibilities being thrust on 
us by the dismal economic picture at the national level and by the 
commendable decision of our national government to transfer to 
local governments greater responsibility for allocating Federal 

After an intense, coordinated lobby effort, largely orchestrated 
by the nation's Mayors, the Federal government has made significant 
strides in returning bcidly-needed tax dollars to local communities and 
giving them the authority to decide how they should be used. 

Millions of dollars in general revenue sharing monies and 
public employment funds now pour into our cities. 

In the near future, we can expect new funds for our transporta- 
tion systems and large block grant awards for community development. 

To maximize the use of these funds, we must be organized 
effectively at the local level. A streamlined budgetary process is 
critical to the effective utilization of new Federal and State 
funds and to husbanding our own local resources. 

At the present time, the best budgeting information we have 
is information on capital expenditures where a program of capital 
expenditures is prepared and alternatives are weighed and measured 
against each other. A priority system is developed which can be 
carried forward into future years, depending upon the amount of work 
undertaken in the previous year. 

This kind of programmatic approach should be applied to other 
sections of the budget. This approach demands comprehensive and 
detailed budget information and uses that information for a rigorous 
assessment of alternative expenditures. The experience gained through 
the capital improvement process should be used as a beginning step 
to improve our overall budgeting system. 

Today, San Francisco receives an estimated $400,000,000 a 
year from the federal government. Generally, these funds are 
restricted to specific kinds of activities, but increasingly they 
permit local official^ to determine where they are spent. 

We have made progress in this area through the establishment 
of program offices in the area of community development, economic 
development, manpower, and criminal justice. We are now in the 
process of establishing a clearinghouse to oversee the integration 
of all federal grants. 

The Honorable 

Board of Supervisors 
Page 'I 

These efforts are a dynamic process for developing a better, 
more integrated, more effective match among available resources, 
needs and opportunities, policies and programs. We are responding 
to the opportunities presented for local leadership and initiative 
such as Community Development Bloc Grants. 

We are taking increased responsibility for the distribution 
of state and federal funds at the local level so that we, as elected 
officials, can better direct resources to the areas of greatest need 
locally. Responsibility is increasingly falling, and properly so, 
on the elected officials who are the ones truly accountable to the 

In addition to constant attention to the management of the 
federal resources of the City, we also need to look at our local 
budget process. In the past weeks you and I have had to deal with 
the thorniest of problems -- setting an equitable arc! fail 1 tax rate. 
And in this process we have again seen the problems of our current 
system of budgeting. 

To set the tax rate, to adequately assess our resources 
against our needs, to allocate funds in a responsible manner 1 , we 
need better information and more realistic budgeting. This is 
the mutual responsibility of my office, the Board, and the Controller. 

The history of large surpluses in unexpended funds at the end 
of each year indicates a lack of realism or a lack of proper informa- 
tion. The fault seems to be in the process; unrealistic budgets are 
submitted and unrealistic budgets are approved. A cycle of cause 
and effect is in motion which will likely perpetuate itself unless 
there are some basic reforms in budgeting policies. 

I do not believe the City should be forced to go through 

these difficulties in setting the tax rate again. I am therefore 

proposing that certain actions be taken at this time to alleviate 
that circumstance in the future. 

Three actions merit our closest attention. These actions 
are designed to move us closer to more realistic budgeting and a 
better understanding of the fiscal condition of the City. 

Action 1: Work Programs 

City departments should prepare work programs that spell out 
the allocation of funds and personnel, and are directly related to 
their budget estimates. These work programs should be submitted 
with budget requests. 

The Honorable 

Board of Supervisors 

Page 5 

The benefits of work program preparation are threefold. 
First, it gives departments a better overall view of their own 
operations. Second, the work program provides a much more 
understandable and readable budget explanation. Finally, the 
work program can become a review document for the Mayor and the 
Board in the review of department budget requests, including 
supplemen tal appropriations. 

A ction 2 : The Co n troller's Report 

I am recommending that the annual Controller's report be 
revised to contain financial projections for at least five years, 
charting both expenditures and revenues. Expenditures can be 
charted on the basis of current costs, anticipated rate of infla- 
tion, and growth factor. Revenues should similarly be projected. 

This is most important because it will give elected officials 
an estimate of what they have to work with in future budgets and it 
will also give an indication of any needs to revise taxation policy, 
i.e., to put more emphasis on one kind of tax and decrease reliance 
on another. 

The Controller's report should also include a summary of all 
supplemental appropriations that were certified and authorized during 
the previous year, by department, so that a more accurate picture of 
total departmental expenditures and how they were determined is 

At the present time the City does not have a fiscal document, 
other than the budget itself, which lays out in lay terms the actual 
costs of running the government and the sources of revenues upon 
which we rely. For all of us, elected officials and the public, to 
make the hard budget decisions that we must, it is critical that we 
have good information that explains what is happening now, which 
projects the costs of programs that we are now undertaking, and 
which tells us what we can expect, from where, in terms of revenues. 

Action 3: Departmental Flexibility 

We should reconsider the policy regarding transfer of depart- 
mental funds. Even with the best of planning, unforeseen and unusual 
circumstances arise which require a change in approved budgets. At 
the present time, supplemental appropriations are the only means by 
which departmental administrators can have any flexibility. There- 
fore supplemental appropriations have been abused. 

The Honorable 

Board of Supervisors 

Page 6 

Both the Board and I have taken steps to curb these abuses, 
but no action has been taken to date on providing a reasonable means 
of flexibility. I believe that City administrators should have the 
ability to transfer monies within their budgets, within limits to 
be established by the Controller and under close monitoring by 
budgetary officials of the Mayor's Office and Board of Supervisors. 

There are reasons for permitting this kind of flexibility. 
First, it reduces the reliance upon supplemental appropriations, u 
system which is both cumbersome and expensive. Second, it speeds 
the time in which administrators can take action, permitting certain 
savings due to the ability to purchase goods or services at the 
earliest possible moment. Third, it increases overall accountability, 
as changes are made within the department's pre-determined budget. 

The City's present system of audits provides sufficient 
recourse to check againsL the abuse of increased flexibility. This 
step will also reduce significantly the paperwork and personnel time 
spent in processing the extraordinary number of supplemental appro- 
priations that we face each year. 

As we embark on the coming year, I believe there are a number 
of important projects San Francisco should undertake to strengthen 
the economic base of the City, provide new jobs for San Franciscans, 
and improve the quality of life for all our citizens. 

I wrote earlier that there is a conspicuous deficiency in 
San Francisco's make-up to which attention should be directed: 
namely, our inadequate public school system. 

The Public School System 

With inspect to the school system, it is fair to say that the 
new elective school board has checked the downward trend of our 
schools. A few years back our Board of Education was dominated by men 
and women inordinately preoccupied with the obsession that the class- 
room is a social laboratory to effect an instant cure of the injustices 
which afflict us as a nation. The effects of this philosophy were 
devastating. Some bright spots remain in the excellence of Lowell High 
School, where a tradition of parents insisting upon achievement-oriented 
standards has withstood numerous attempts to drag it down to lower levels, 
The road back lies in recognizing that the main object of education is 
to provide basic skills in disciplined courses of instruction and 
to transmit from generation to generation a system of values and a 
sense of history, subject always to critical inquiry and change in 
the light of evolving social phenomena. The class room is simply not 
the place to compensate for all of the ills of our society. While 
timely comprehensive studies of the system have value, they are more 
often than not escape hatches for delaying the inevitable but tough 
decisions that must be made. 

The Honorable 

Board of Supervisors 

Page 7 

Urgent Specials Needs of the City 

Without meaning to exclude so much that is important .. I am 
listing special needs of San Francisco which are in contemplation and 
which I suggest be pushed with perseverance. In combination they are 
essential to the continued primacy of San Francisco as a city of 
unique quality. 

These include: 

1. A symphony hall in Marshall Square. 

2. A library annex to be built by a 197S bond issue 
on the property known as NS Hyde Street. 

3. A longer-range plan for a regional library in Civic 
Center in collaboration with Federal, State and 
County governments and the institutions of higher 
learning in the Bay Area. 

•4. The beautif ication and development of Pier 45, and 
the remaining properties from Fisherman's Wharf to 
the Ferry Building. 

5. The development of shipping facilities and terminals 
south of the Ferry Building starting now with the 
finances on hand. 

G. A new museum to house San Francisco's pre-eminent 
Asian art collections, a venture now underway by 
the exceptionally able Asian Art Commission. 

7. A television-radio complex to house our television 
and radio stations and to provide television and 
motion picture production facilities indoors to 
match the substantial out-door production industry 
which has been built in San Francisco as a new 

I thank you for your attention to this letter. 

Very truly yours, 

[dxJlkA-^ 1 

Joseph L. Alioto 
/' Mayor 


r* san tuncisco 

r ** 

^ .u-u-^ Huu^cittlx &n^^&uf£MUH4 DOCUMENTS 


October 6, 1975 rtJ^tSfc? 


Board of Supervisors 

Room 235, City Hall PURSUANT TO CHARTER 

Son Francisco, California 94102 SECTION 3.1DU 

Ladies and Gentlemen: 

In reply to the annual question of "how stands the state 
of our City?" our reply must be: 

"It stands very well". 

We have fended off the fate that daily threatens New York 
City. However, there is much to do in the future if we are to 
safeguard this magnificent City from the doom forecast for New York. 

This City has a Triple A bond rating. It is the reward 
of our fiscal prudence. It also is the mark of a city that has 
continued its economic growth while other major metropolitan centers 
proved unable to halt decay. San Francisco's total property 
valuation in a four year period has increased more than $5'! 6 million. 
There is no abandoned property in this City and we have a downtown 
core that is the envy of a nation. 

The Advisory Commission on Intergovernmental Relations, 
an impartial agency which examines the finances of America's 
Cities, reported in July that San Francisco k^eps income and outgo 
in balance, maintains reasonable surpluses, Las a high rate of 
property tax collections, and holds bonded debt to a manageable 
size. In brief, the nation's bond specialists find our City healthy 
not only by evidence of its financial records but by its general air 
of vitality. 

Despite a continuing difference of opinion over this City's 
tax rate between the Mayor and members of your Honorable Board, we 
find our citizens taxed today within reason. The $11.50 per $100 
rate recently approved for fiscal 1975-1976 will provide the 
revenues required for the necessary services of government. In a 
real sense, its adoption represents a victory for those espousing 
the cause of never taxing to unjustifiable surpluses. 

The Honorable Board of Supervisors October 6, 1975 

Page 2 

It is not amiss to note the differences between the San 

Francisco tax rate and the rates of nearby communities Oakland, 

$1M.60; Berkeley, $16.69; and Piedmont, $15.24. 

Our differences of opinion have included views on the 
equity of sharing increases between the business community and 
the property taxpayer. My view has been that necessary increases 
should be shared on a 50-50 basis. However, your Honorable Board 
has demonstrated its conviction that the business community should 

experience only fractional increases $M.5 million in a $28 million 

overall need for new funds with massive increases being imposed 

on the homeowier. It is our earnest hope that, despite your 
decision on the current tax rate, there will be a re-examination 
of the policy which places business in the most favored position 
as a taxpayer. 

Much has been accomplished in the physical development 
and rehabilitation of the City. Market Street is entering the 
final phase of its redevelopment. BART is a reality and, despite 
the harshest criticism, is the ideal for which others now strive. 

The greatness of a City, however, is measured by its 
spirit rather than its skyline. The social programs it fosters 
reflect its spirit and it is my conviction that an examination 
of San Francisco* s social programs proves this community has a 
valid claim to greatness. 

In 1968 this City was marked by racial tension,, It was 
a major manifestation of the urban crisis forced by the times upon 
all major cities. This City, however, recognized and dealt with 
the manifestation before it reached the proportion of a crisis. 

For the first time, the representatives of the minority 
groups received, the most prestigious and powerful appointive 
positions in an z ^ministration. The business and labor communities 
were encouraged to respond to the needs of the time and the response 
was forthcoming. Your City government accepted its responsibilities 
and today, we find more than one third of City workers have been 
recruited fiom the minority groups. At this moment, San Francisco 
is the most integrated City in this nation. 

The Biblical truism of, "the poor ye shall always have 
with you" retains its validity today. This City, however, has 
used and continues to use the resources available to It to 
ameliorate the conditions of poverty and joblessness. 

The Honorable Board of Supervisors October 6, 1975 

Page 3 

During the past year, San Francisco devoted $6, '181, 781 
in federal Manpower Training funds to instruction of the needy 
jobless. Of those taking part in the training program we find 
more than 1,000 placed in gainful and continuing employment. 
Of those now working, 89 percent are members of minority groups. 

We also have devoted $7,618,900 to Public Service 
Employment and at this moment are providing jobs for 2,312 
persons who otherwise would be without employment. 

Our relocation and local rent assistance programs have 
eliminated the perils of eviction, especially for the City f s 

Our Model Cities, Criminal Justice and Community Di opment Pr grams 
have been directed to neighborhood projects which the neigh hoods 
themselves have deemed th it necessary a thy of development. 
The growth of citizen involvement in health and menl iJ alth 
activities is unsurpassed in any other American City. 

We have 'witnessed the selection recently oi tncisco 
as the "Most Liveable City in the United States",, It was a choice 
made by readers of the Christian Science Monitor, a reading- 
audience distributed throughout the nation and aceiaf I For its 
intelligence and discrimination. They ba: ed th ;ir judgi nt on an 
awareness of all the good things taking place in this City, both 
in the public and private see tor. They we t?e of our fostering 
of the arts as man Lies ted in a id Lcient 

Symphony and equally magnificent ballet. They were aware of the 
tolerant spirit of this City hili b mindful that tolerance 
; not extend to what is harmful to the majority. 

In that last respect, we should be mindful that 

Francisco has shown a 20,000 decrease in "hard co is since 
1969, an experience duplicated by few other cities. 

The nation also has recently witnessed San Francisco 
being selected as the City with the best and most balanced transit 
system. The choice was made by the Council on Municipal Performance. 
after a study of transit systems in 28 major American cities. 

We in San Francisco should not assign the victory in 
transportation to the triumph of a brick, concrete, and steel 
project. Rather, we should consider it the result of dedication 
to the greatest public good by providing that which is necessary 
for the comfort and convenience of all, the greatest job mobility, 
and least damage to the environment. 

The Honorable Board of Supervisors October G, 1975 

Page U 

Any report on the state of the City would be an ex< rcise 
in futility if it ignored unfilled need:-; of the City. The following 
are preeminenl needs: 

1. The development of the norl rfront from the 
San Francisco-Oakland Bay Bridge to F.i Wharf to its hi 
and best commi rcial uses. 

The needs are so obvious that they do not merit 
repetil ion Nor should there be a repetition of the obstruction- 
under-the-guise-of-environm ' : protection that has left us with 
possibly the world's mosl unsightly, unpro ta Lc, string od 
and fire-gutted piers. 

2. The develop n ;i i oj the Verba Buena Projei t, [t is 
unconscionable that the 111 ; ; ition o the pi o i 

be allowed to continue . ;'■ ann able b 'to ition of 

one of the most valu d :< d irs of land in th a bar 

to providing employment in a time of desperal 

3. : tdership to raise th i qua] Lty of public tioj 
within the Ci ty. '! are indii or the 
future in the selection of a del J School Suj 

directed by an elec L. But th in 

leadership whn eh will i imite cl the diminishin] stal oj Ln . :- 
tion that f o ! i ■ I the forced bi : i : ;u tmitte 

predicated on erroneous interpretations of the law 

'i . The development of Hunters Point Shipyard, either 
as a private or public project, as a source of the 5,000 employn 
lost through its closing by the Navy. 

5. Che Lifting of the dispari b : I on the residential 
taxpayer through the development of other sources of revenue. I 
have previously refer,'. I at length in this report to. the inequity 
of the business and real property taxes. 

6. The development of a Performing Arts Center. Already 
$5.5 million hay been committed from the private sector to construc- 
tion of this facility which promises to enhance the quality of life 
for the entire Bay Area. 

7. The continuance of seeking federal grants necessary 
to maintain the quality of life in the City. 

The Honorable Board of Supervisors October G, 1075 

Page 5 

I believe :isco T s business in Washington 

requires a Mayor to travel to the nation's capital every month, 
or at least every other month. 

The federal presence in this City now involv s ) arly 
$2 billion each year. Despite a tremendous federal payroll, 
$J00 million in Social Security payments, and annual expenditures 
of $100 million in une still is heard I 

plaints of poeudo leaders who desire to cue federal involves* i 
irregardless of the jobs end vital public works brought into 
the l: Involvement. This City now has $'120 million 

in federal grants in force ana per;, lj ilications for another 
$''423 million. Make no mistake, federal funds are the second 
budget of this City. 

I wish to pay homage to City government' s 

resources those who serve so ably as heads of departments, 

their subordinates, and the conscientious leaders who form 
the membership of our many boards and commissions. 

The close support I have received from thi 
Administrative Officer has merited my warmest personal gratitude. 

I have said publicly that the "seeds of New York exist 
in every city" but I say to you today that is no reason to 
believe they will ever germinate in San Francisco. Our Charter, 
the people who serve the City, and the residents who abide 
therein, provide all the safeguards againsc the plight of New 
York becoming the blight of San Francisco. 


oseph L. Alioto 



CONTACT: Corey Busch FOR RELEASE: 7:30 PM 

415-558-3755 Monday, October 4, 1976 


i ' 1976 

Pursuant to Charter Section 3.100, it is my duty as Mayor to 
report to the Board of Supervisors and the people of San Francisco the 
general condition of the "State of the City". 

Thirty-six mayors and 396 supervisors have served the people of 
our City over the past 200 years, and each of those men and women have, 
in their own ways, had a hand in shaping the San Francisco of today -- 
the "State of our City". 

The fiscal health of San Francisco is a primary concern to all of 
us entrusted with the leadership of this great City. It is, of course, 
not our only concern -- for it certainly cannot be. But it is our 
major concern as we meet here this evening. 

Shortly after I conclude this message, this Board of Supervisors 
will determine the property tax rate for fiscal year 1976-77. The 
debate in recent days surrounding this single issue underscores many 
of our mistakes of the past and should help us chart our fiscal course 
for the future. 

Earlier this year, I asked every department head in City government 
to come to my office and consult with me so together we could determine 
how we could best cut departmental expenditures without denying the 
people of our City essential services. On a cooperative basis with 
department chiefs, I cut some $118 million from the spending requests 
submitted to me. We attempted, in our meetings, to remove the fat and 
inefficiencies from those budget requests. We attempted to establish 
not only priorities for spending, but priorities for not spending as well 

We accomplished those goals in our budget. This Board saw fit to 


trim an additional $30 million from that budget and you approved, by 

a vote of 11 to 0, San Francisco's spending program for this fiscal year, 

Shortly thereafter, in a speech before the Commonwealth Club of 
California, the President of this Board of Supervisors commented on 
that budget, stating, "In all, I can only describe this year's budget 
as heroic. ...Our Finance Committee made tough cuts. The budget will 
total an increase of only 1.97% from the current fiscal year." 

Yet, San Franciscans face a potential increase in their property 
tax rate today of perhaps as much as $2.00. A reading of the newspapers 
the last few weeks would lead one to believe that this tax increase 
comes as a surprise to some people at City Hall and that the only 
question is, "Who is to blame for this mess?" 

The tax increase we face should not come as a surprise to any 
public official with any continued interest in the fiscal affairs of 
our City. 

Prior to my assuming the Office of Mayor, I asked the Controller, 
last December, for a report on our financial status so I could be as 
well prepared as possible upon assuming the Office of Mayor to deal 
with our situation. I was told then that San Francisco was facing a 
deficit which could be as high as $56 million and that we faced a large 
property tax increase. 

The people have a right to know why they face an increase in their 
property taxes at the same time they face decreasing spending and 
decreased services. 

Perhaps the facts are best spelled out in a recent Grand Jury 
Report which stated, in part, "...the net effect of (last year's) novel 
use of anticipated surplus would be to postpone an inevitable tax 
increase. ...There will, indeed, be a substantial increase in the ad 
valorem property tax rate and the magnitude of this increase is 


attributable in part to the decision of Mayor Alioto and the Board of 
Supervisors to use anticipated surplus for the purposes of setting the 
tax rate. ...The net effect of this policy was to keep the tax rate 
artificially low." 

The point to be made by this report of the Grand Jury is that 
despite the warnings of the Controller and the fiscal advisors of the 
Board of Supervisors, last year's tax rate now stands as an "artificially 
low" standard for what we do this year. 

I have submitted to this Board proposals which will trim in excess 
of $20 million from that which we are required to fund at the present 

The September 27, 1976, edition of the San Francisco Examiner, in 
its lead editorial stated, "The supervisors, whose thrifty motivations 
arouse our admiration, are trying to cut the budget by $30 million. 
Mayor Moscone states with commendable realism that it can't be done; 
he thinks a $15 million cut is more like it. He is right." 

If this Board of Supervisors accepts my proposals for an across- 
the-board 47o reduction in spending by City departments, the people of 
San Francisco will experience some reductions in services to be sure, 
but those reductions will, in the words of our department chiefs, not 
deprive the people of vital services. Cuts beyond those already ordered 
by the Mayor may mean, again to quote the Examiner editorial, that 
"the City would suffer from excessive reductions in services..." 

If the Board further accepts my proposals for non-property tax 
revenues, as introduced in part by Supervisor Dianne Feinstein, all of 
San Francisco will share in the same sacrifice necessitated by this 
fiscal crunch. 



The key to both our 47o across-the-board savings and the sharing 
of the responsibility to provide needed new revenues is the equality 
of treatment for all people. No one segment of the community should 
be charged in excess of another. I know that this Board knows that 
everyone in San Francisco is affected by the property tax rate and 
that we are not just talking about the single family homeowner in the 
Sunset or Richmond in our debates here, but we are also talking about 
the renter who lives in Hunters Point or the Mission or the Marina or 
anywhere else in San Francisco, where their rent will be affected by 
what we do here this evening. 

Homeowners and renters cannot pack this additional financial 
burden by themselves. It is up to us to see that they don't. 

As we grapple with the question of the future of our City and the 
ways in which we can assert effective fiscal control over that future, 
it is an illusion to think that the only options available to local 
government are to either raise taxes or cut services. 

One of the most fundamental efforts this, or any City can and must 
make, is the effort to increase the productivity of both this City's 
human workforce and its physical plant. 

Rather than ritually raising taxes or slashing departmental 
budgets beyond a level which is reasonable or safe, we can make our tax 
dollars go farther than they have in the past; allow our City employees 
to be more productive than they have in the past; and realize even 
greater services from our City's very considerable financial investment 
in its capital facilities. 

The public media and the Grand Jury have recently underscored our 
need to more fully fund our maintenance and capital improvement programs 
and to explode the penny-wise and pound foolish myth which has been 


prevailing in our City regarding "deferred maintenance" -- the habit 
of allowing this City's physical plant to fall into a state of uncon- 
scionable shabbiness because some individuals believe that the politi- 
cally motiviated short-run savings they realize by refusing to properly 
maintain our physical facilities will somehow obscure the long-run 
fiscal disaster which confronts us when those facilities break down 

The people of San Francisco have paid hundreds of millions of 
dollars over the years to construct, maintain, and operate a multitude 
of vital physical facilities -- which include MUNI vehicles, police 
vehicles and equipment, fire-fighting equipment, roads, buildings, 
parks, street lights, and many others. The people have a right to 
expect that these facilities will be kept in decent shape -- that they 
will not be allowed to deteriorate to the point at which the cost of 
repair is replacement. That is what we have allowed to happen and that 
is poor business practice. 

In the current budget I recommended a total of $26.4 million to 
allow our City to catch up on needed capital improvements, as well as 
the maintenance and repair of the existing physical plant. This Board 
cut that figure by $6.1 million. There is no question but that we 
must maintain a firm, unshakeable commitment to the upkeep of our City 
facilities . It is money we must have the courage to spend now in order 
to avoid staggering costs in the future. 

It is also money which must be spent if we intend to maintain our 
current Triple A bond rating. On a recent visit to New York, I met 
with representatives of Standard & Poor's and Moody's (investment 
brokers). One recurring question asked of me concerned itself with 
the condition of our City's physical plant. We cannot expect people 
to invest in our City as long as we continue to neglect the very 


basic principle of continued maintenance and repair. 

Once again, ladies and gentlemen of the Board, the "State of the 
City" could well be endangered by political blinders which only take 
in the short-term picture and fail to focus on our responsibilities 
to the future. 

In discussing increased productivity, we cannot neglect to mention 
the need to provide our department heads, as well as our policy makers, 
with an updated and modernized budgetting technique which better allows 
us to track our monetary flow and provide for the most efficient use 
of our tax dollars. We are moving in the direction of program/perfor- 
mance budgetting and we must continue to improve our terribly antiquated 
budgetting system. 

And, finally, we must let our public employees know that while 
they are public servants, they are not serfs. They must be treated 
with respect, allowed to do their jobs, and encouraged to question our 
methods . 

Our recent experience in averting a MUNI strike should serve as 
evidence that our public employees are not blood thirsty parasites 
unwilling to recognize the fiscal constraints of our City. Given the 
proper time in which to sit across a bargaining table and negotiate 
in the best tradition of employer-employee relations, our City govern- 
ment and our public employees can set levels of compensation which are 
fair to both the worker and the taxpayer who must pick up the tab. 

Honest give and take can and will lead to lasting labor peace. 
We must be firm, but we must always be fair. Our public employees ask 
for nothing more, and the improved "State of the City" depends in 
many ways on lasting labor peace. 


This year, we instituted the City's first employee evaluation 
system, not just as a management tool, but so that those doing a good 
job will know that their efforts are recognized. We must now take the 
necessary next step and provide for awards for exemplary service, 
similar to incentive programs in private industry. 

And, most important to this entire question of increased productiv- 
ity, we must not tolerate the political demagoguery of those who would 
use our public employees as scapegoats for all the problems we now 
face. It is unfair -- it is dishonest -- and it is destructive to 
our City to do so. 

The "State of the City" insofar as employment of our residents is 
concerned is not good. Our "official" unemployment figures place San 
Francisco's unemployed at 12.77o. The national rate is 7„97o. 

Unemployment in areas such as Hunters Point, the Mission District, 
the Western Addition and South of Market are staggering -- with 
estimates over 25%. 

We have made good use of the Comprehensive Employment and Training 
Act (CETA) funds provided by the federal government to combat unemploy- 
ment and we must be vigilant in our efforts to insure the continued 
funding of that program. 

This summer saw the most successful Summer Youth Program in our 
City's history. The Mayor's Office successfully lobbied for an 
additional federal grant of $1.4 million to supplement our original 
$2,7 million grant and we were able to employ over 8,500 disadvantaged 
young people during the summer months. 

But unemployment does not vanish with the end of summer and we must 
seek ways in which that program can be extended on a year- 'round basis. 


The heavily impacted Hunters Point Community will shortly receive 
a badly-needed shot in the arm with the reactivation of the long 
dormant shipyard. Ultimately, the reopening of that facility will 
mean thousands of new blue collar jobs. 

Although the City worked hard to establish the Port as the master 
tenant at Hunters Point Naval Shipyard because of our belief that the 
deep water capabilities at the Point could open new and profitable 
vistas for our Port, the Navy ignored our pleas and instead awarded 
the contract to Triple A Machine Shops. We are continuing to negotiate 
with Triple A and we will continue to protect our Port's interest in 
Hunters Point, but nevertheless, it is encouraging to the community 
to know that jobs will once again be a reality at the Shipyard. 

The India Basin Industrial Park project, although stymied by 
federal reluctance to provide needed financial assistance, is moving. 
One-half of the land is either already sold or under negotiation 
and, again, this project will mean jobs for people who so desperately 
need and want them. 

The Redevelopment Agency, which has come under heavy criticism by 
certain people, should not be the baby which is thrown out with the 
bathwater. Recent allegations of wrong-doings by Agency personnel 
cannot obfuscate the fact that the Redevelopment Agency, recipient 
of national awards, has accomplished a great deal for our City -- and 
the India Basin and Yerba Buena projects must remain as high priorities. 

Two ballot propositions on the November 2 election ballot will 
have a great impact upon the "State of the City". Proposition A, sup- 
ported by the Mayor and ten Supervisors, and Proposition S, supported 
by the Mayor and ten Supervisors, are both critical to our City's 
future and should be passed by the electorate. 


Proposition A, simply stated, will enable our City to move ahead 
on its commitment to modernize its sewage treatment facilities in 
accordance with state and federal regulations. It is a disgrace that 
our record of foot-dragging and non-compliance over the past several 
years has now put us in the embarrassing and costly position of facing 
monthly building bans, and of ultimately facing a complete, City-wide 
building ban which could last for several years. 

It would, of course, be foolish for us to blindly accept the 
dictates of the state or federal government without constantly reviewing 
those demands and questioning their validity to San Francisco. It 
would also be foolish for us to stop reviewing better and cheaper ways 
in which to rebuild our system of wastewater management. We shall 
constantly review and modify with the goal of building the system as 
inexpensively as possible. 

But we cannot fall victim to the specious arguments which call for 
the defeat of Proposition A, because I do not believe that even the 
opponents of the measure are prepared to live with the devastating 
economic fallout which would result by our failure to pass it. 

Proposition S allows the people of San Francisco to vote, for 
the first time, on the question of Yerba Buena Center. After more than 
ten years of promises, delays and setbacks, the people of San Francisco 
have finally been invited by their government to participate in the 
planning of this important property South of Market Street. A broad 
cross-section of San Franciscans, appointed by the Mayor several months 
ago, held numerous public hearings throughout our City to determine 
the best and most widely acceptable plan for Yerba Buena. 

That Committee's work, doubted by many at the beginning as being 
useful, has now proven what many were unwilling to try -- that people 
with different viewpoints and different ideas for our City can sit down 


at a table and, through compromise and honest give and take, work 
out their differences for the best interests of our City. 

Proposition S, supported by two- thirds of the Mayor's Select Com- 
mittee on Yerba Buena and by ten Supervisors along with the Mayor, calls 
for the construction of a convention exhibit hall at Yerba Buena, to 
be financed by lease-revenue bonds supported entirely by the hotel 
tax. Those who will use the facility most, visitors, will be those 
who shall pay for its construction. It will not be on the ad valorem 
tax rolls, yet it will bring an estimated 50 million new dollars into 
our economy the first year alone. Fifty million new dollars to be 
spent in our restaurants, theatres, retail stores, hotels, neighbor- 
hood shops, and pumped into every aspect of our economy. 

The passage of Proposition S will also mean jobs for San Franciscans 
Not only the jobs involved in the construction of the center, and not 
only the jobs involved in running the facility once open, but the jobs 
created and maintained by the fact that the Center will bring 200,000 
new visitors into our City every year. With an estimated one out of 
every five jobs in San Francisco related to tourism, we cannot fail 
to bolster and improve our number one industry aggressively. To do so 
would be foolhardy. 

So the "State of the City" in some respects, awaits the outcome 
of Propositions A and S. Both require affirmative votes of the people 
for the sake of our City's well-being and economic health. 

Of equal importance to the future of San Francisco, however, is 
the survival of our unique and distinct neighborhoods. Few would argue 
that in many ways the magic, uniqueness and long-run viability of 
San Francisco is directly linked with the continued good health of 
our neighborhoods. 


I have taken strong steps during my first nine months in office 
to guarantee that San Francisco not only protect its neighborhoods -- 
but that the men and women who live in those very diverse communities 
play a major role in the governmental decisions which affect them so 

It is a matter of great pride to me that the Grand Jury referred 
to one of my newly-appointed commissions by stating, "We are also aware 
that the new Board is very concerned about public input. The Board, 
at its first meeting agreed to meet in the evening for public conven- 
ience. And the composition of the new Board also brings varying 
viewpoints into play with minority, women and gay populations repre- 

Immediately upon my election last December, I convenued a group 
of men and women from San Francisco's neighborhoods to advise me on 
the very important matter of the appointments I would make to the policy 
making boards and commissions of this City. In examining the hundreds 
of applicants for positions on boards and commissions, this screening 
committee recommended to me the names of concerned and dedicated 
citizens of this City -- most of whom had never before been given the 
opportunity to participate so directly in their government. 

In the February, First Semi-Annual Report of the Commission on 
the Status of Women, the Commission points with pride as a major 
accomplishment that they had, "Lobbied George R. Moscone, the Mayor, 
to appoint women on key commissions such as Fire, Police and Planning 
and the Board of Permit Appeals resulting in nine women out of 20 
appointments . " 

My goal in making such appointments has been to unite the many 
divergent, often hostile voices in this City, and to channel our col- 
lective energies and efforts into one positive direction., It has 


not always been an easy task, but I can tell you that the alternative 
to this painstaking effort is one of continued fragmentation and 
division in our City. 

We must end the old "neighborhoods vs. downtown" game. 
I believe that my Planning Commission, for example, has taken great 
strides to bridge the gap that once existed between the neighborhoods 
and downtown. 

This Commission, for the first time in recent memory, gives strong 
representation to those neighborhood interests which, for years, had 
felt that their only relationship with City Hall was an adversary 
relationship . 

In appointing the new Planning Commission, I made it clear to the 
new members that they had a mandate to work cooperatively with every 
community of interest in this City and to carry forth the pledge I made 
in my inaugural address to provide "growth -- but well planned growth 
and not soulless ripoff that we'd be ashamed of twenty years from now." 

There were those who claimed that the new Commission was anti- 
growth, anti-business and that they were dead set against any kind of 
commercial development in our City. 

Their actions have proven those people wrong. This Commission has, 
in a short period of time, worked out a plan which means that the first 
positive steps in years are now being taken to provide development of 
our long-dormant Northern Waterfront. They have sanctioned an 
ambitious new development in the Candlestick Cove area which will mean 
jobs and increased revenues for our City. The Planning Commission staff 
has processed a variety of permits at a rate of almost 600 per month 
and are constantly seeking methods in which to cut red tape and speed 
the process. 



In the same way that our Planning Commission has supported and 
expedited legitimate commercial projects throughout San Francisco, 
so do they scrupulously maintain the integrity and liveability of 
our neighborhoods as they administer a City-wide residential rezoning 

I am proud that our Planning Commission has been able to reconcile 
the aspirations of both the neighborhoods and business interests and 
that this Commission stands as an example of a government agency 
serving its primary function -- namely, to bring different and competing 
concerns to mutual accommodation. 

The future of our City depends in large part on the ability of 
our neighborhoods and business community to recognize their mutual 
dependence on one another. If the neighborhoods are allowed to deteri- 
orate into shabby, rundown memories on the periphery of a business 
center, that business area will experience a profound deterior atlon 
as well. Conversely, if the neighborhoods of this City come to sur- 
round a business center which is unable to grow, generate new jobs, 
and bring greater revenues into our City's treasury, those neighbor- 
hoods will soon experience the very same kind of suffocation and 
decline. It's that simple and that basic to the future of this City. 

I realize there may be some critics who single out this "State 
of the City" address for what it appears to have overlooked, rather 
than what is has discussed. There will be those who express concern 
that this speech has not focused at length on the important and 
pressing problems of crime, education, housing, social services, health 
care, transit and the MUNI, model cities, the aging, criminal justice, 
our cultural programs and facilities, the port and airport, as well 
as other vital concerns to the people of our City. I share that concern. 


But I would respond by reminding you that earlier this summer, 
I completed a series of public addresses before more than 20 of our 
City's important policy making boards and commissions to discuss with 
them my goals and directions for the areas of their jurisdiction. 
It is impossible to adequately discuss in one speech the many important 
tasks we have before us. 

That is why I took that time earlier to appear in open, publicized, 
public sessions, to discuss with the people and the various agencies 
the areas not specifically addressed in this message this evening. 

During the course of my campaign for Mayor, there were those who 
expressed concern over my "image" as a "liberal" concerned only with 
social issues and human needs. These people questioned whether or not 
I could temper my "liberal" views with the fiscal restraint called for 
during these difficult times. 

No one has been more dedicated this past year to putting our City's 
fiscal house in order than have I. The people of San Francisco can have 
confidence that their Mayor is dedicated to preventing San Francisco 
from slipping into obscurity or decay through poor fiscal management. 

But I also want to serve notice on this occasion that I am still 
the "liberal" concerned with social issues and human needs who was 
elected the 37th Mayor of San Francisco last December. No one feels 
a greater disappointment than do I that our City simply does not have 
the financial resources to perform so many of the urgently required 
tasks now before us. 

We have talked at length about trimming the budget and stabilizing 
the tax rate -- and we shall do both. But San Francisco has always been 
a City which takes great pride in its dedication to social justice and 
its concern for the plight of those less fortunate than we„ We cannot 
and will not allow those principles to fade into oblivion as we face 


these difficult financial times. 

The task before us, as I see it, is to set our fiscal affairs in 
order and to do so with lasting reform which will help us avoid in 
the future the obstacles we face today. If we are unable to accomplish 
these goals, then we will not be able to attack the social problems 
we face in our City. 

It is essential that we make some sacrifices today in order that 
we can more quickly address ourselves to our long-range social problems. 
If we deal with today's financial problems quickly and effectively, 
we will be in a better position sooner to deal with the question of 
improving the quality of life for all San Franciscans. 

An extremist and myopic viewpoint on either side of the ledger 
is unacceptable to San Francisco and it is unacceptable to the Mayor 
of San Francisco. We must not allow our concern for our City's fiscal 
integrity to blind us to the legitimate needs of our people. A balance 
will be struck. I ask your help in the months and years ahead and I 
ask for the help of all San Franciscans. I also ask for their patience 
as we prepare today to meet the human challenges of tomorrow. 

When I began this address, I mentioned that 36 mayors and some 396 
members of the board of supervisors have preceded us to this moment and 
that they have, in their own ways, participated in the molding of the 
current "State of our City". 

Mayors and Supervisors come and go -- but the City remains and it 
is our job, as I see it, to be the guardians of that future. I often 
think of what kind of City we will leave our children and our grand- 
children -- for the decisions we make today will affect their lives 

Ladies and gentelmen of the Board, we cannot mortgage the future 
of our City. The future does not belong to us -- it belongs rather to 
those who will inherit the City we are shaping today. Thank you. 

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1373 OCT L5 PH 2:5! 

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STATE OF THE CITY ADDRESS Monday, October 15, 1979 

San Francisco has been through a truly shattering ordeal in the last year. But 
the tragedies of last winter are finally behind us. The process of unification has 
begun in earnest. And our magnificent City can now foresee a future which is 
brightening and encouraging. 

The immediacy of San Francisco's pressing fiscal problems cannot be permitted to 
obscure our substantial accomplishments. Before discussing the general administrative 
operations of the municipal government, pursuant to Charter Section 3.100, I would 
like to explain why I believe that the state of the City is fundamentally sound. 

San Francisco's prosperous economy has made important gains; personal income is 
up 9.1% over the last 12 months and unemployment, now at 5.9%, is down 30% from 1978, 
according to the Bureau of Labor Statistics. 

Our MUNI, which provides the most complete public transportation system of any 
major city in the country, has made drastic reductions in the number of missed runs. 

Our port, which is making money, signed on two new shipping lines. We have a 
dazzling new plan to open up our Northeastern waterfront to commerce, housing, and a 
magnificent bayside park. And we look forward to increasing trade with China. 

Our housing stock is being rapidly rehabilitated and renewed. The U.S. Department 

of Housina and Urban Development called San Francisco "the best example of urban renewal 




in the nation." 

We have stimulated economic development of our businesses, neighborhoods, and 
commercial districts. We anticipate as much as $275-million in new construction and 
rehabilitation this year alone. 

The last year has seen substantial and undeniable strides in bringing modern manage- 
ment practices to a city government which, in the past, has all too often been sadly 
deficient in this area. 

Through hard work and skillful negotiation, we have equitably settled lawsuits 
which had for years held up the hiring of police officers, threatened the disbursement 
of revenue sharing funds, and thwarted the construction of the George R. Moscone 
Convention Center. 

We have opened the door to a burgeoning trade with China which will assure San 
Francisco's prominence as an international trade center and mean more blue collar jobs 
for San Franciscans. 

Through skillful administration, we managed the orderly provision of vital services 
in the face of tremendous disruption wrought by Proposition 13. 

Our bonds remain rated at triple A, the highest rating there is. 

Our citizens remain the most tolerant, diverse, and creative an amalgam as there 
is in any city in the country. 

There are six major areas of concern that I shall be discussing during this State 
of the City address, and which will continue to occupy our attention in the year ahead. 

1. We must and we will find a new, long-term balance between the services the 
city offers and the revenue base that funds them. Where we cannot reduce services, we 
must find new and reliable sources of income. 

2. We must strengthen our Police Department so it can deal more effectively with 

3. We must find ways to promote and enhance the city's vibrant economy and increase 
job opportunities for San Franciscans. 

4. We must make certain that downtown growth does not conflict with the needs of 
our neighborhoods. The quality and vigor of the neighborhoods must be preserved and 

5. We must make certain that new housing opportunities, at affordable prices, 

are available to middle and lower income families who are bearing the heaviest burden of 
an incredible inflation in hosuing costs. 

6. We must find new ways to strengthen the management corps of our city, and to 
recruit the best available talent to serve our people. We made a start in this direction 
during the past year. We must continue our efforts, and intensify them. 

The Fiscal Problems: 

San Francisco's most immediate problem is its lack of sufficient revenues for the 
1980-81 fiscal year. There is no question that we face a substantial gap between our 
anticipated expenses and our revenues. 

To address this problem, we have our best administrative talent looking into 
increased general fund revenues from a variety of sources. We are making the strongest 
possible case in Sacramento and Washington for our fair share of state and federal funds. 

We are now giving the most careful scrutiny to each and every program and every 
department. Our commitment is that we will get "maximum public service for every dollar 
invested." Every service we provide, every program we sponsor must survive the twin tests 
of community need and cost efficiency. Proposition 13's effects have been cushioned for 
two years; there is no more cushion. The upcoming budget session will bring with it 
some very hard choices. 

In addition to the exploration of each and every legal avenue for additional revenues, 
we have established a performance measurement system to achieve management accountability. 

(Toward that end, I strongly recommend the adoption of Proposition B, a measure which 
will enable us to properly reward and encourage good management.) 

Let me review with you some of the major accomplishments during the past year of 
the Mayor's Committee for San Francisco, a citizen's committee headed by Walter Hoadley, 
executive vice president of the Bank of America. This committee has been working 
quietly and effectively, in all areas of our government. Task forces involving 50 
executives from business, labor and the community were assigned to 17 specific projects, 
11 of which have now been completed, with savings estimated at $10-20-million a year for 
San Francisco. 

One such project is an executive management training program, funded by a $41,000 
Blythe-Zellerbach Committee grant. Lewis Allen Associates provided training for 125 
top executives in city government. This is the first time we have had formal management 
training for our top executives. 

Sixteen classes in supervisory training for city employees have been conducted, 
with 220 trained as of September. Civil Service is developing follow-up techniques for 
reinforcing the management skills and to guarantee that more city employees receive 

It's all very well to say you're going to eliminate waste and promote efficiency 
in government. But if you don't develop management skills needed to accomplish these 
laudable goals, it's nothing more than idle rhetoric. 

A task force reviewing our payroll system found that our present system is extra- 
ordinarily complex, unnecessarily costly, unreliable, and incapable of adjusting to 

Your honorable board recognized the merit of these findings, and approved two new 
positions this year, payroll director and payroll project director, under Controller 

John Farrell, to develop changes and modifications that will mean direct savings of 

$600,000 to $l-million a year. 

The Mayor's Committee also took on such assignments as reviewing our cash manage- 
ment procedures, the operations of San Francisco General Hospital, the work of our 
purchasing department, and assessing our office space utilization. 

What this adds up to is more efficiency in city government. That translates into 
saving public money. 

The public should be assured that our commitment to management efficiency is not 
a one-shot campaign which will soon be forgotten. It will be an on-going theme which 
will manifest itself in budgeting, procurement, planning and service employment well 
into the next century. Sloppy government administration will not be tolerated in San 

Even with our management efficiencies and our new revenues, we will have to set 
priorities. We will have to trim our sails. But this administration will not endorse 
mindless across-the-board cuts and arbitrary "freezes." Nor will it use public 
employees as scapegoats. We are in the process now of studying our choices in a careful 
and deliberate manner. Our personnel policies will be designed to mitigate the impact 
of any necessary cuts as much as possible. But there will be reductions in both 
personnel and in the provision of services to the public. Let there by no mistake about 

Reductions will not be made in a punitive or vengeful manner; "efficiency in 
government" will not be code words to justify an attack on the poor, the sick, and the 
helpless, the very people who rely on a sensitive and compassionate government the most. 

Let us now look at some areas of major concern. 

Public Safety 

Perhpps the greatest threat to the liveability of the city is the fear of crime, 
a paralysis which affects primarily the poor, the elderly, and our minorities. 

If tomorrow the government were to declare martial law and impose a curfew at 
nightfall, none of us would stand for such an arbitrary abridgement of our liberties. 
Yet today, the fear of crime poses a similar threat for many of our povr and elderly, 
who are often prisoners in their own homes. 

This administration will not tolerate a nightfall curfew, imposed by thugs, and 
tacitly condoned by a criminal justice system which sometimes forgets about deterrence 
and recidivism. Along with robberies and purse-snatchings, we have seen alarming 
incidents of muggings, attacks, assaults on gays, on women and the elderly on our 
streets and on MUNI. These incidents are intolerable and we intend to make sure that 
both the Courts and the hoodlums know it. 

This past year we have finally started the process of hiring police officers to 
bring the department up to full strength; our department will be strong, competent, 
professional; its members will reflect the ethnic and social composition of the City. 
San Francisco will put police on the streets in sufficient numbers to assure our safety. 
I promise you that, also. 

I have called for a new community relations unit for our Police Department that 
will coordinate with the district stations in combatting tensions and social unrest that 
could flare into open confrontations. I want you to know, also, that I am committed to 
the selection of a new chief of police from within the department who respects the men 
and women in the force and is, in turn, respected by them. 

We will continue and, wherever possible, strengthen our police training program, so 
the new men and women who join the uniformed force will meet the highest standards of 
professionalism. In accordance with our agreement when we settled the Officers for 
Justice lawsuit this year, they will be representative of the community they serve. 

Settlement of that lawsuit, of course, meant that we can now recruit enough police 
to bring the department up to its authorized strength of 1971 uniformed personnel for 
the first time in history. 

We have seen improvements in our Courts; the number of prison commitments has 
increased almost threefold in the last four years; we have seen an admirable commitment 
by the prosecution to remove the violent criminal from the streets. The improvements 
which we have seen - sentences for adult offenders - have not, unfortunately, been 
paralleled by the treatment which violent juveniles receive. This is an area sorely 
in need of reform. 

Our Police Department is woefully undermanned, and yet statistics indicate that, 
compared to other cities in the United States, we are holding our own in the everlasting 
battle against crime. 

Our Arson Task Force has made tremendous strides. Arson in San Francisco has been 
reduced almost 4% in the last year alone, while it increased nationally by 25%. Arson 
arrests have averaged 4 times the national average and our conviction rate has risen 
to an astronomical 74% of cases brought to trial. 

The success of the Arson Task Force (comprised of the Fire Department, the Police, 
and the District Attorney's Office) provides an example of the kind of cooperative 
approach to government problems which I have tried to encourage. 


MUNI is in the earliest stages of a building process to make up for years of 
neglect, inadequate management, and the application of an inadequate resource base to 
enable it to care for its own equipment and facilities. 

While MUNI continues to cover the city in a fashion unequaled in the United States, 


its level of service remains unacceptable. A constantly growing ridership--increasing 

at the rate of 15 percent a year is straining the capacity of the system. In order 

to meet the demands of the next several years, MUNI will have to continue on the road 
it has now undertaken to provide vastly improved maintenance of its facilities and 
tighten control of its day-to-day operations. 

As recently as March and April of this year, MUNI was unable to put 10 percent of 
its scheduled runs on the street because of maintenance breakdowns. MUNI now has so 
improved its day-to-day maintenance that is has not missed a run of the diesel and 
trolley coach fleet in the past four months. Street car missed runs, which were averaging 
20 to 40 a day last Spring, are now down to four to 10 a day. 

MUNI sends out 1000 runs daily. Driver absenteeism, always a serious problem, is 
now receiving management attention. It is still too high. But a progressive and 
innovative new labor contract with the Transport Workers Union has been signed, and it 
will give us the opportunity to vastly improve our operations. Paired with a fair wage 
and fringe benefit agreement was the recognition by the union that management has the 
right to hire part time workers to drive buses in order to meet rush hour surges in 
demand. Further work rule changes increased management flexibility and opened up an 
era of union and management cooperation that will inevitably mean more efficiency and 
better service for MUNI riders. 

Our renowned national landmark, the cable cars, will be partially closed down 
during the next several months. The cable car system will be rebuilt and restored 
completely during the next few years. Last week Secretary of Transportation Neil 
Goldschmidt came to San Francisco and met with me to discuss federal funding for 
restoration of this priceless national heritage. We will get the funding we need to 
rebuild the cable cars. But in the meantime, no cable cars will run until we are 
convinced that their safety level is acceptable. We will not gamble with safety. 

Finally, after an investment of some $300-million and ten years, our MUNI Metro 


System will begin operations in January. This new system, with its vast, quiet, and 
admittedly very complex cars, will enable us to increase dramatically the carrying 
capacity of MUNI from the Western, Southeastern and Southwestern sections of our City. 
The time it takes to get from the Castro Portal to the Embarcadero will be about one 
quarter what it is now on streetcars. 

Downtown and the Neighborhoods 

I said that Downtown growth must not impinge on the vitality and economic and 
social health of our neighborhoods. Both have key roles to play in the economic and 
social health of San Francisco. It is not necessary for them to be in conflict. Both 
can flourish in a sound and vibrant community. 

Unlike the downtowns of almost every American city, San Francisco's downtown is 
thriving. I was informed recently that Macy's San Francisco store is second in sales, 
based on square feet of selling and storage speace, only to Bloomingdale's in New York 
City store. Their volume is now running better than $100 million a year. And they 
will soon have new neighbors--Nieman Marcus and Saks Fifth Avenue. Downtown retail 
business is soaring. Our hotels are full. Our convention and tourist business is 
increasing. When the new $l00-million George R. Moscone Convention Center is in place, 
it will increase even more. The incredible expansion of office space in our downtown 
continues. Downtown is healthy. 

So are our neighborhoods. 

As you know, San Francisco receives grants of some $26-million a year in Community 
Development funds from the Department of Housing and Urban Development. This block 
grant program is directly responsive to our neighbrohoods, and sets as a primary goal 
the upgrading and stabilization of low and moderate income communities. We seek to 
improve and increase the supply of affordable rental and owner-type housing, increase 
the viability of neighborhood businesses, and provide supportive improvements of public 
and private facilities. 


Community Development funds, for example, are used to provide low income for 
rehabilitating housing. Next year, we estimate that 3640 units of housing will be 
rehabilitated in San Francisco through this program alone. 

In the past year, approximately 500 units of new subsidized federal housing was 
committed in San Francisco neighborhoods. Since January, $10-million in loans were 
made available to low and moderate income families for home ownership and home improve- 
ment in San Francisco. Almost $12-million in California Housing Finance Agency funds 
will provide 217 units of lower income housing to families and elderly persons in San 
Francisco. Our own loan programs through the Redevelopment Agency and the Bureau of 
Building Inspection have provided $3.25 million to rehabilitate more than 570 units 
of housing. We plan some 2,400 units of housing on our Northeastern waterfront. A 
major new housing development will be privately built at Playland. 

These are projects that make a difference. And they prove San Francisco can produce 
needed housing. 

I would like to compliment the Board on moving promptly to establish a Rental 
Arbitration Board that is working to stabilize rents and prevent unjust evictions of 
tenants. That Board is in operation now. It has had more than 600 inquiries, more than 
95 percent of them from tenants. There have been more than 100 hearings, and another 
110 are scheduled. In addition, 75 cases have been settled without the need for formal 
hearings. Sixty three percent of those that were heard resulted in decisions favoring 
the tenants. The Rental Arbitration Board is in place. It is working. I hope we 
give it a chance, and that we defeat the Rent Control initiative—Proposition R--on 
next month's ballot. 

In addition, this Board enacted and I signed, a condominium conversion ordinance 
that provides an orderly scheme permitting some units to convert to condominiums while 
requiring the production of new housing for low and moderate income families. 


The condominium ordinance and the rent arbitration board are good examples of 
creative legislation, unique in the nation, that we provided to meet some of our most 
pressing problems. With this kind of approach, and a willingness to say that problems 
can indeed be solved, we will meet our challenges in the years to come. 

Through the Mayor's Office of Economic Development, we have made a strong commit- 
ment to improving our neighborhood businesses, bolstering the blue collar industrial base, 
and channeling tremendous economic benefits for San Francisco residents. 

San Francisco must not become a "one industry town" or a "boutique city" for the 
enjoyment of commuters and tourists. We need a mixture of blue and white collar jobs in 
finance, shipping, trade, services, retailing and wholesaling, distribution, and 

The Economic Development Office has in its one year of existence concentrated on 
1) neighborhood commercial revitalization, 2) "citywide" loan programs designed to finance 
jobs and investment in small, expanding businesses, and 3) public works projects intended 
to prepare sites for employment-generating economic development. 

It is now developing the capability, both in terms of financial capacity and land 
development potential, to attract and retain the business investment for jobs, tax base, 
and neighborhood revitalization. 

As an example of what we have been doing, we have placed or processed $12.8 million in 
low-interest, long-term loans to small business, utilizing $56,000 in community develop- 
ment funds; this level of investment should generate 600 jobs at a cost to the City of 
$84 per permanent job created. 

The commitment by private financial entities of $10 million to assist businesses 
in the South of Market, northern Mission, Potrero, and Bayview-Hunters Point, which 
should create or retain 1,000 jobs is another example. 


The China Gateway Committee, similarly, set the stage for trade which will 
provide the blue collar jobs which San Francisco so desperately needs. Our recent 
trip to China gave San Francisco an advantage in trade that is the envy of cities up 
and down the Pacific coast. 

Our commitment to job creation is complemented by the employment training efforts 
of the Mayor's Office of Employment and Training. Our youth, and particularly minority 
youth, need jobs and job-training. The unemployment rate which minority youth suffer 
is intolerable and unconscionable; it is a strong contributing factor to our crime rate. 
We cannot neglect our obligation to find and create jobs for our young people. 

Although San Francisco's CETA program has had, and continues to have, good perfor- 
mance ratings from the Department of Labor, adverse reports about CETA in other parts 
of the country resulted in drastic changes in CETA legislation that would have forced 
the City to lay off more than 1600 workers, most of them young, and most of them not 
yet fully trained for the labor market, on September 30. 

I met with Secretary of Labor Marshall and with Vice President Mondale to argue 
for a waiver for a majority of our CETA workers. We got it. Some 1208 CETA workers 
kept their jobs and we can now plan for an orderly transition over the next 12 months. 

It meant we could retain 125 positions with the Police Department, including 70 
ML. II guards, 129 health services personnel, 57 public library employees and 121 persons 
assigned to our Recreation and Park Department, among many others. 

In addition, and thanks in large measure to the splendid work of Elizabeth Robbins, 
whom we hired this year to represent us in Washington, the Department of Labor increased 
our credit for administrative expenses for CETA programs from $316,731 to $1,840,656 for 
the fiscal year 78-79 and 79-80. 

Other Departments 

Let's look, briefly, at some of other accomplishments of city departments this 
past year. 


The Health Department reorganized its administrative structure at a considerable 

The Department is collecting revenues better than ever before. At San Francisco 
General Hospital, for example, collections were $1.5 million more than had been 
projected. Laguna Honda billables are up 12 percent. With your approval, we established 
a billing system for emergency medical services that will cut in half the reliance on 
property taxes. It also means we will have ten new ambulances, paid for out of fees. 

As I mentioned earlier, San Francisco General Hospital now has full accreditation, 
and a laudatory commendation on the superior quality of care it offers. 

We will soon be opening Clarendon Hall of Laguna Honda Hospital, thereby providing 
170 additional skilled nursing beds for the needy elderly citizens of our city. 

The Airport Commission set a goal of improving productivity by 10 percent over 
the next five years. 

Strong management has been able to hold down the number of employees at the new 
North Terminal substantially under the 886 you authorized. Actual employment there is 
under 800 

Significant savings have been effected through tight management of the Airport's 
construction program. By requiring the redesign of the control tower and Pier D, 
construction costs were reduced by $7-million. The cost of administration for the 
construction program has been reduced by $1.2-million a year. 

The Airport itself continues to prosper. Passenger traffic is increasing at 
11 to 12 percent a year. Our efforts to make this the Gateway City to Asia paid off 
at the airport, as well as the port. The first direct commercial flight from China 
will land in San Francisco in December and regularly scheduled service between San 
Francisco and Beijing will begin in the Spring. 


Redevelopment is sponsoring some $275-million worth of new construction and 
rehabilitation this year. That includes 24 new industrial plants and office buildings 
totalling nearly 2.2 million square feet. Some 1600 new and rehabilitated homes, both 
subsidized and market rate are being built. Thousands of construction and post- 
construction permanent jobs will result. 

Last week we announced grants of more than $l-million for two major neighborhood 
parks in San Francisco—McLaren Park, which received a $507,000 grant from the Department 
of the Interior, and Mission Playground, which received more than $600,000 from 
Interior, for rehabilitation and expansion of a worn-out physical plant. 

Friday I took Secretary of the Interior Cecil Andrus on a tour of Golden Gate 

Park. Early next month he will receive an application from us for $1.2 million to pay 

for major reforestation and other improvement projects there. I am certain our arguments 
will be persuasive. 

The Park Department this year replaced the grass turf on Candlestick Park, 
renovated the Senior Citizen's Center in Golden Gate Park, provided new play apparatus 
for Mission Dolores Park, reconstructed the Jackson Playground Field House, is nearing 
completion of a new recreational center at Chinese Playground. 


I recognize, as do you, that we face fiscal and administrative problems of 
substantial magnitude. But that is no cause to throw up our hands, lose hope, and 
forecast disaster. 

Doomsday prophesy and seld-righteous posturing do not solve problems, nor do they 
provide the basis for leadership. The constant wailing of our City's Cassandras is 
no substitute for calm and rational decision making. 


I emphasized in this state of the city address positive accomplishments, of 
which we should all be proud. We are eliminating waste. We are becoming more 
efficient in our operations. We are finding new sources of funding. We are seeing 
to it that essential services are maintained at a high level. We are meeting the needs 
of our neediest citizens--the poor, the elderly, the sick and the infirm. 

Before we say we can no longer afford a neighborhood library system, or an 
extensive system of parks and recreation facilities, and before we say we must withdraw 
support for cultural programs, or reduce our protective services, we must do three 

1. We must be certain we get full value for every dollar we spend. I have 
already cited some of the ways major departments are doing just that. We have in place 
in the Recreation and Park Department, and we will be installing it in other depart- 
ments as well, the FIRM program, a management tool that can tell us precisely whether 
or not our money is being well spent in a cost-efficient manner. 

2. We must investigate every possible source of additional revenue. Certainly 
there are fees for service that can and should be increased. We have both a Washington 
and a Sacramento representative now whose primary task it is to see to it that we get 
at least our fair share of State and Federal money. I believe our revenue producing 
departments, including the utilities, the port, and the airport, must make a greater 
contribution to the general fund to help defray the costs of other departments that 
don't produce a profit. There may be tax sources we have not adequately tapped. Legal 
means of increasing our income must be examined. That effort is now underway and I 
shall be reporting its progress to you soon after the first of the year. 

3. If, after all these avenues have been fully explored, we find we still must 
cut services, we must make these cuts carefully, sensitively, and with a commitment to 
preserve that which is vital to those who by force of circumstance depend on government 
the most. Cuts must be made so as to do the least damage to our economic base. And 


they must be made in a manner that will minimize disruption. 

These are difficult times. There is no way you or I can wave a magic wand to 
make the dark clouds overhead disappear. We have problems. We will find solutions. 

When you elected me Mayor, I pledged to begin the work of bringing about San 
Francisco's emotional reconstruction by calling on all segments of the City to work 
together in a spirit of civility and tolerance, in the spirit of St. Francis, our 
patron Saint. 

I have kept that pledge. I worked cooperatively with you and with neighborhood 
groups, with labor, with business, and with various minority communities to build for 
our common future in a spirit of compassion, conciliation and cooperation. 

I come to you now in the same spirit. In the years to come, we must work 
together, closely, to solve our common problems. We can't do it with negativism. We 
can't be divisive. 1 can't do it alone. And you can't do it alone. We need to help 
other, and we will, for the sake of the city we love. 

Office of the Mayor 






OCT 8 1980 


Monday, October 6, 1980 

San Francisco is a great city. 

Where other cities are dying, San Francisco is building and thriving. 

Where other cities fade in the despair of blight and unemployment, 
San Francisco expands opportunities and puts more people to work than ever 

Where other cities cut back vital services and fall victim to arsonists 
and hoodlums, San Francisco puts more police on the street and maintains a Fire 
Department equal to none. 

Where other cities abandon their parks and museums and become simply 
urban deserts, San Francisco builds a triumphant symphony hall and fights to 
keep its parks among the loveliest in the world. 

Where other cities succumb to freeways and the cementing of their 
neighborhoods, San Francisco treasures its uniqueness and vibrates with a 
renaissance of neighborhoods. 

Where other cities plunge into backruptcy, San Francisco resolutely 
balances its budget and maintains essential services. 

Where other cities are hangdog with defeat and despair, San Francisco 
still lifts peoples' spirits and puts pride in their hearts. 


All of you on the Board, I know, share my pride in being part of the 
City, and in serving in the government. But, of course, it is not a perfect 
city. Tensions simmer beneath the cooling fog. People are jobless and go 
hungry and live in blight. Wind piles debris on streetcorners, and the budget 
battle continues daily to maintain those services vital to a civilized commurit 

To me, however, the most dangerous deficiency in our City government is 
lack of stability. The City seems to be on a turbulent sea where initiatives 
threaten like hurricanes to overturn any sense of continuity and planned effort. 
I am hopeful that this election, once and for all, will settle the question of 
whether the City should elect supervisors at large or by districts. Personally, 
having worked closely with the Board, I have come to the conclusion that a Board 
chosen by district elections is as good as one elected city-wide. But no legislative 
body can function at its best if its terms are constantly being cut in half. 

Ultimately, the City must be protected against the constant shifts of 
undoing today what was voted on yesterday. In the event November's vote on 
district elections is not decisive, but simply hangs on a narrow balance, I 
will convene a representative group to work out a compromise that will settle 
the issue once and for all. To survive, a city must be able to plan and follow 
a steady and consistent course. Many issues, such as building homes and 
creating jobs will be resolved, only through long, uninterrupted effort. 

Let's look now at what, by working together, we have accomplished 
together this Dast vear: 

MUNI ---Service still may be ragged at times with buses bunching and 
running late. But it is improving, steadily and irrevocably. In the past year 
and a half our maintenance programs have improved to the point where vehicle 
availability is now up to nearly 90% of our total fleet. This means that more 
buses are on the street and on time than ever before, and that our Muni's 
maintenance has gone from one of the worst in the United States to one of the best. 


The new Muni Metro has added comfort and safety to public transportation, 
and has resulted in an incredible surge in ridership of some 50-60,000 more 
people per day than last year. This is an increase of some 60-70%. Muni Metro 
also reduces travel time from the Sunset by 25-35 minutes, and slashes commutes 
from the St. Francis and West Portal areas in half. I look forward to similar 
improvements in the central and southern neighborhoods. Our cable car system 
which lyrically climbs half way to the stars, is worn out after more than a 
century of service. It will be completely overhauled. The Federal government 
already has provided the first $3-million to get restoration underway, and it 
has pledged the majority of the $58-million to complete the work. $10-million 
will be raised in private donations. 

POLICE Since my report to you last year, 155 police officers have been 

added to the force. The City now has 1722 officers. Two more recruit classes 
will graduate this month, and by this time next year the department should be at 
its authorized strength of 1971 men and women. The new officers and every available 
veteran are being assigned to the streets in an increasingly visible array throughout 
the City. The diversion of more than 100 officers during the hotel strike in 
mid-summer allowed crime to flare in the vacuum of some areas. But now that 
officers are back on their beats, the crime rate, which spurted upward is now 
coming down, and I believe we've now re-established the initiative. With the 
new Chief, morale in the department is high, and a variety of proven and 
effective units are now being thrown into the fight against crime. The mounted 
unit has been revived. Motorcycle and motorbike patrols have been expanded. 
The S-Squad has been reactivated to saturate high crime areas. And a community 
relations unit has been re-established to help ease inter-group tensions. In 
this regard, the Human Rights Commission has established a special clearing house 
to arbitrate when confrontations threaten. 


Additionally, communications will be thoroughly modernized so emergency 
calls get through quickly. As a result of last April's mammouth earthquake 
drill, improved communications equipment has been installed to link vital 
city agencies. And by next summer, I expect, at long last, a "911" emergency 
telephone system will be dispatching police, fire and ambulance services. 

ECONOMIC HEALTH By all indicators, San Francisco remains a goliath 

of vitality among American cities. Employment remained stable last year 
despite a serious, nation-wide recession and unemployment dropped to 7.4% 


in August of this year from 8.6% the year before. There are 1700 new blue 
collar jobs in the City, an opening door to opportunity. But, on the grim 
side, unemployment among minority young people remains a despairing 40%. 

TOURISM is booming. Hotel tax collections soared from $18. 5-million 
in FY 79 to nearly $24-million in FY 80, an exuberant increase of 28%. And 
already, a full year before its opening next year, the Moscone Convention 
Center has been booked for 250 events through 1999. Our port continued to 
operate at a profit for the second straight year and is expected to earn a 
total of $3. 5-million in 1980--an increase of nearly 80% over 1979. 

PUBLIC PROJECTS Inflation and tight budgets have forced some cities to 

abandon major projects, but San Francisco continues to preserve and enhance its 
beauty. It's a grim struggle. Cuts have sliced deeply into our ability to 
maintain parks as islands of quiet and beauty. Since 1976, the number of park 
workers has been reduced by ninety-nine to 136. I am now meeting regularly 
with park officials to mobilize a sustained maintenance program. A $1.4-million 
grant from the Department of Interior launched a 25-year reforestation of Golden 
Gate Park and additional funds will complete restoration of the City's historic 
Conservatory of Flowers. A resplendent new jewel will begin to form this year with 
the selection of a private developer for the $300-million "gardens" and hotel in 
the Yerba Buena redevelopment area. 

Additionally, the City continued to make progress with its clean water 
program to prevent the befoulment of our Bay and our beaches. Now being scaled 
down from $2.3 to $ 1. 6-billion, the project has been assured adequate funding 
by the President's Office of Management and Budget, the Environmental Protection 
Agency and the state's Water Quality Control Board. 

Above all the issues, the greatest priority for this past year and for 
the coming one is to keep our budget balanced and essential city services maintained. 


BATTLE OF THE BUDGET Providing San Franciscans with maximum public 

services for every dollar spent remains this Administration's No. 1 goal. The 
situation, perhaps, is best seen as a perpetual game of "catch-up" played with 
two strikes against us. The first, the Gann initiative, will become a major 
factor in 1981/82. In that regard, I am pleased that the Governor has signed 
SB 940 which will allow us to use regional population change in computing our 
revenue limits. SB 940 recognizes that San Francisco is the hub of a vast 
metropolitan area. 

The Controller has released preliminary figures showing that for 1980/81 
we are well within our revenue limits... by about $49-million. This figure when 
adjusted for CPI and population change will give us our 1981/82 limitation. The 
Controller also has projected cost increases totaling $69. 5-million for next 
year, of which $46-million is for salary standardization, $20-million for 
inflation and $3. 5-million for retirement. Depending on how much of this 
projected increase is covered by the Gann limitation, it seems that we will be 
very close, or at our revenue limit, assuming we can generate the necessary 
dollars without additional cutbacks. 

It is important that the implications of that revenue limit be clearly 
understood. What it means it that regardless of charter mandated cost increases, 
regardless of ongoing programs or projects, regardless of any commitments or 
obligations to constituencies or organizations, there is an unbreachable ceiling 
on what we can raise and spend. Spending decisions will have to be made within 
these constitutional parameters, and that is true even in the unlikely event 
that we somehow have the resources to satisfy all of our demands . 

The Gann initiative is not the only way in which population affects 
finances. There are a number of federal and state subventions based in part on 


population. It is therefore with some relief that I can advise you that the 
population loss projected for San Francisco in the 1980 census seems to be 
relatively slight especially when compared to the precipitous declines shown 
by other major cities. Our Planning Department now estimates a population of 
670, 000, a 5.5% decline. Our losses were minimized by an excellent local 
review process which added 25,000 people to the rolls after the initial census 
figures were released. 

The second major external factor is, of course, the matter of the state's 
surplus. An unintended but major effect of Prop. 13 has been that we have 
become, more than ever, clients of the state. The permanent "bail-out" legislation 
contains a so-called "trigger" which will automatically reduce local subventions 
if the state's own revenues and surplus fall below certain limits. We do not 
know now, nor will we know until we are almost at the end of our own budget 
process, whether and to what extent we are threatened by a reduction in state 

Looking backward for a moment, we came through the 1980/81 budget 
battles relatively unscathed. This is a tribute to the combined efforts of 
the legislative and executive branches, united with the business, labor and 
neighborhood communities. Our revenue crisis was partially resolved by the 
voters approval of the Human Services Revenue Package and the defeat of 
Proposition 9. Propositions 0, P and S all received the necessary two-thirds 
vote providing some $47-million of cost savings and increased revenues. 
Proposition Q received a substantial majority, all that we believe it needs 
in order to generate another $17-million for the general fund. That question 
is now being litigated in court, and we are hopeful of a positive ruling. 

MANAGEMENT The key to making dollars stretch is good management. 

During the past year, 13 major departments came under our Management-by-Obj ective 


system, which links budgets with results. Detailed performance standards are 
set and automatically measured and reported on a quarterly basis. During this 
next year, another four departments will convert to the system and all other 
departments will be included by the end of fiscal 1983. Additionally, the very 
essential training programs for supervisors and mid- level management personnel 
classes remain full. My office and the Civil Service Department are working 
to implement a management performance evaluation system for all higher level 
managers. This should become operational by the end of this fiscal year. 

We can and will continue to push hard for increased productivity. If, 
however, you consider that the rate of inflation between August 1979 and 1980 
increased by 15%, and that for the same period our natural growth in revenues 
in the general fund would have been less than 5%, it is evident that we simply 
cannot keep pace, that our efforts at efficiency and productivity improvements 
will at best provide only a part of the answer. 

I can tell you now, however, that I will not ask for nor support any 
increase in general or business taxes this year nor will I approve any increase 
in fares for the general ridership of the Muni . We will continue to encourage 
increases in fees or the establishment of fees for departmental services where 
these should be made self-supporting, but we do not intend to ask the people 
for increased tax authority to fund the 1981/82 budget. 

We will, instead, have to maximize our non-tax revenues. I intend to 
reinforce efforts to generate monies for the General Fund from our enterprise 
operations. I am confident, for example, that we can negotiate an agreement 
with the airlines and our bond holders which will, for the first time, provide 
for infusion of dollars from the Airport to the General Fund. I am also 
certain that greatly increased support will be generated from our highly profitable 

"non-profit" garages, several of which I am determined to bring into full City 
ownership this year. 

The Supreme Court decision on Hetch Hetchy should mean that we can 
anticipate some $8-million in new revenues next year. We have negotiated a 
new reimbursement rate for certain patients at Laguna Honda which will reduce 
that institution's dependence on the General Fund by nearly $7-million a year. 
We have submitted to the people a charter amendment on next month's ballot 
which will allow pre-1976 uniformed members of the Police/Fire retirement 
system to buy-out of their old and into a new system. If approved, Proposition F 
could save up to $6-million a year depending on how many officers choose to avail 
themselves of the buy-out opportunity. 

We will use our influential legislative delegation to see to it that 
the taxes we legitimately collected on the 1978 unsecured rolls, taxes now in 
our treasury but frozen by the legislature, will be released, and bring some 
$15-million into our general fund. I will also continue my policy not to 
approve anything but the most urgent personnel requisitions. The City work 
force will thus continue to shrink by attrition with the result that our 
opening balances for 1981/82 will be higher than anticipated. 

This brings us to perhaps the most troublesome problem we will have to 
face together in the decade of the 80' s. The matter of wage policies for San 
Francisco's civil servants. The Controller, in estimating his $79-million 
revenue gap for 1981/82, indicates that $46-million of that total will be for 
increased wage costs. 

It is clearly impossible for the City to live with those kinds of 
charter mandated increases in wages, a Prop. 13 mandated inability to raise 


revenues and a constitutionally imposed revenue limitation all at the same 
time. Something has to give. If we follow all of these considerations to 
their logical conclusions, it becomes very clear that what will give is 
employment . We will be forced into the untenable position of trading existing 
jobs for higher wages . The leadership of those unions which represent the 
bulk of the most vulnerable city employees recognize this dilemma. 

What is needed is a joint effort involving your Board, the Civil Service 
Department, the Administration and representatives of city employees, jointly and 
affirmatively, to try to deal with this problem rather than being victimized by 
it, to handle it with time on our side rather than in a crisis atmosphere next 
Spring. Should there be expressions of interest from the legislative branch 
and the labor movement, I will be glad to organize and lend my support and 
staff to such an effort. 

HOUSING But if controlling the budget and improving management remains 

a priority within City Hall, the development of housing is a clear urgency in 
the City itself. In the past year, HUD made commitments for 1,000 federally 
subsidized units, twice 1979's commitments. Almost $10-million is being 
provided in California Housing Finance Agency funds for 240 units of low- 
income housing for families and for the elderly. City loan programs through 
the Bureau of Building Inspection increased from $3. 25-mil lion in 1979 to 
$7.4-million in 1980. These monies will be used to rehabilitate more than 
900 homes, almost twice the number rehabilitated last year. And the Redevelopment 

Agency is about to commence acquisition in the Northern Waterfront area on a bold 
project for 2400 units. Already under construction is the City's largest home 

ownership project in years, the $93-million Opera Plaza with 463 units. 

But demand for adequate and affordable housing in San Francisco 

continues to outstrip our efforts--which is why I applaud this Board's prompt 

action on the conversion recommendations for two of the six proposed surplus 


school sites. 

Our public housing is finally emerging from a dark age. Reforms are 
streamlining administration and modernizing maintenance. Forty-eight renovated 
units just opened at Hunters Point and another 200 units will be ready by 
January, 1981. The backlog of vacant vandalized units has been cut. Old 
audit exceptions have been cleared and, for the first time, multi-year 
contracts have been negotiated with unions at the Authority. Tenants are now more 
involved in the actual operation of the projects. 

I am pleased at the progress. A new deputy director in charge of day- 
to-day operations will be on staff by the end of the month, and I expect, under 
careful monitoring by my office, for progress to continue. I am committed to 
providing a decent environment for the 22,000 persons in public housing, but I 
am equally determined that persons who vandalize and trash should be removed. 

On the larger horizon of our City, I am committed to orderly growth 

in the downtown and in our neighborhoods. I continue to be dazzled by the 

vitality and growth in our neighborhoods, preserving and enhancing a unique 
mosaic of style and character. 

As far as downtown is concerned, a major step was taken in recent weeks 
to assure better control over growth. A compromise was reached on how to 
proceed with the environmental assessment of downtown. The project has the 
support of environmentalists, labor, developers and concerned neighborhood 
organizations. It has the endorsement of the City Planning Commission, and 
the development community has agreed to finance the effort. The important 
point here is that we now have a proper forum to debate and to resolve the 
problems brought about by downtown growth. 

Another project of major importance to this Administration is the City's 
building permit process. The cost of delays and uncertainties in the current 


system is intolerable. A developer-- large or smal l--should have a permit 
application handled within a reasonable time period. We are embarked on a 
project to see that this happens. A management consultant firm is working with 
my office and the Planning Department's permit system should be overhauled 
before the year's end. 

ECONOMIC DEVLEOPMENT--This Administration also plans to carry on the 
active promotion of our City's economy by strengthening the 
partnership between the public and private sectors. My Office of Economic 
Development has been totally reorganized. Experienced and proven administrators, 
who know San Francisco well, have been brought in to maximize efforts to obtain 
federal and state funds and to leverage private sector dollars. This past year, 
the OED provided $7-million in private and public financing to expand small 
businesses in San Francisco. Another $5-million in small business financing 
will soon be released. These funds will assure jobs for one thousand San 
Franciscans . 

Additionally, the Office of Economic Development will continue to press 
for Urban Development Action Grants (UDAGs) from the federal government. Only 
last week, San Francisco received a UDAG for $2.9-million to build 237 units 
of market-rate, moderate and low-income housing at Playland-at-the-Beach. 
Estimated to bring in some $500,000 annually in increased tax revenues, this 
no-strings grant also will leverage some $32-million in private investment and 
will create 185 new permanent jobs for San Franciscans. 

Our first UDAG, which was awarded only last July, will rehabilitate 
Steuart Place along our waterfront. It is expected to result in private 
developer repayments of over $3-million to a newly created Housing Finance 
Fund which, in turn, will be used to rehabilitate residential hotel facilities 
for San Franciscans. Several other UDAG's are being worked on, including one 


that would finance a major commercial development in the Western Addition. 

In order to monitor closely, and to better coordinate our efforts to 
provide adequate and affordable housing for San Franciscans, I also will meet 
bi-weekly with a housing implementation group of city department heads to 
facilitate construction and rehabilitation so all San Franciscans can live 
decently and within their means. 

Of course, there is much more that can be said of our City. But I believe 
I have highlighted the major thrusts and accomplishments of the past year, and 
given some scope to the priorities for this coming year. 

Tough decisions were made in the past, and will have to be made in the 
future on how this City can live within its budget and still provide services 
that protect life and property but make living worthwhile in a great metropolitan 
center. These decisions, it seems to me, can come only if the City is assured a 

government that truly represents all sections of the City. Continuity is 
essential. Stability must prevail. 

In closing, I want to emphasize my appreciation to this Board. Over 
the past year we have developed a strong working relationship. I feel a warm 
and firm rapport, a sense of mutual confidence and shared optimism. Optimism 
opens the way to opportunity, and I am abundantly sure that this city will 
continue to progress. With continuing partnership between the Mayor and 
Board, in close alliance with business, labor and the neighborhoods, the City 
will continue to build houses, keep police on the street, maintain parks, 
balance the budget without new taxes and meet head-on all the other priorities 
underscored in this report. 

My confidence in this City is absolute, and I believe will be fully 
justified in the year ahead. 


Office of the Mayor 







2 P.M., MONDAY, OCTOBER 19, 1981 

I am pleased to report to you that the state of the City at this time 
is--from many perspectives — extremely healthy. 

Physically, socially and economically, San Francisco stands at the fore- 
front of American cities. 

San Francisco has always been a geographic gem, its beauty attracting 
people from all parts of the world. 

Now, San Francisco is becoming a governmental rarity. Our City's govern- 
ment is sound and it is strong. We have one of the best managed cities of our 
size in America. We are providing essential services within a balanced budget. 

I will seek today to describe the state of the whole City, not just the 
problems and progress of its government. We need to look at San Francisco in 
all its dimensions, public and private. 

The state of the whole City at this time is not only decidedly good--it 
is becoming better. 

San Francisco is on the move. 

The evidence of our City's vitality is abundant and convincing. 


Total employment is up. Although San Francisco's population declined 
somewhat between 1970 and 1980, we gained about 48,000 jobs during the decade. 
For the past fiscal year alone, more than 20,000 jobs were added to the City's 
employment totals. And our unemployment rate is below the national figure. 

Business activity is way up. Retail sales, for example, increased 
substantially from 1970 to 1980. Big new retail stores have opened recently 
and more are planned. This year, retail sales are running 12 percent higher 
than in 1980. 

Right now San Francisco is moving ahead with planned and proposed 
construction of ten hotel projects which will add almost 5,000 rooms to our 
City's capacity to accommodate visitors. 

The growth of San Francisco as a headquarters city and the new development 
of office buildings are phenomenal. For the past fifteen years, the annual 
increase in office space has been 1.5 million square feet. The Planning 
Commission this year has already approved the construction of more than three 
million square feet. About 24 million square feet of office construction is 
underway or planned. That does not include the development of new buildings in 
the Yerba Buena project. 

The most impressive statistical evidence of our City's health and vitality 
comes, perhaps, from data provided by the Bureau of Building Inspection. In 1980, 
the B.B.I, reports, the total value of new construction or rehabilitation of 
buildings was $380 million. This year, it will be $668 million. And the residential 
construction and rehabilitation this year accounts for more than 50% of that amount. 


In 1980, the value of residential rehabilitation approved by the Bureau 
was $9 million. This year it will be $64 million. 

All over San Francisco, improvements are being made in commercial and 
residential areas. Our neighborhoods are still distinctive, and their residents 
are well organized. Our schools are functioning more smoothly, with no 
disruptive strikes; attendance is up and test scores are rising. Culturally, our 
City is vibrant; opera, ballet and the symphony are thriving. 

San Francisco is increasingly being recognized as one of the better 
administered big cities in the nation, thanks to the strength of an outstanding 
team of skilled, professional managers, our new training programs, and the 
utilization of MBO (Management by Objective) techniques. With the cooperation 
of our managers, we have standards of performance and productivity by which the 
public can measure how well and how efficiently we deliver service. San Francisco 
stands out as one of the few American cities of comparable size to continue to 
provide critical services within a balanced budget. Despite the ravages of 
inflation, spending limits and the cuts resulting from Proposition 13, our City 
continues to keep police on the streets, our fire protection service strong, 
libraries and health facilities open, our parks maintained and our streets swept. 

A welcome confirmation of the City's sound financial condition came just 
this past Friday. Standard and Poor's rating service announced its decision to 
reinstate the "AA" rating on general obligation bonds of the City and County of 
San Francisco. 

That is indeed good news. The "AA" rating was withdrawn a year and a 
half ago, because of a lack of an audited financial statement required by 
Standard and Poor's. After those statements were subsequently prepared and 


after a thorough review by Standard and Poor's, their highest possible rating 
was reinstated for San Francisco. 

We are stretching precious dollars to maintain the increasingly delicate 
balance between costs and revenues. This is a battle of the budget that all 
major cities in America are waging. As Washington policies shrink the portion 
of the national budget available to states and cities, the question of how to 
assist the elderly, the needy and the unemployed becomes tougher to resolve. 

We obviously still need support from the Federal government, but we also 
have to involve the private sector. We have asked the private sector to help 
us to build housing, to help rebuild our cable car system and to open more 
job opportunities to minorities. 

The business community has also helped the City move swiftly into a 
modern system of fiscal management. With the substantial help of the Mayor's 
Fiscal Advisory Committee, made up primarily of experienced business leaders, 
we have modernized our City's government and saved money in the process. 
Managers are now better trained. Our accounting system has been automated, 
yielding $30 million in old and dormant accounts. The Fiscal Advisory Committee 
estimates that recent administrative-management reforms have saved us more than 
$40 million. 

We are also turning to our enterprise departments — the port, the airport, 
Hetch Hetchy and others capable of earning funds for the City, and we are asking 
them to produce more revenues for us. We recently negotiated an historic agree- 
ment with airlines using San Francisco International Airport, which, when 
implemented, could earn about $80-million for the City's General Fund over the 
next decade. Shortly, we hope to be selling surplus power to surrounding 


jurisdictions and private industry at market or near-market rates. This will 
produce substantial new revenue. Also, the Assessor reports that during this 
past fiscal year we have increased our Assessment Roll by 10.5%, which has 
generated an additional $21 .6-million in property tax revenues. 

As important as these uses of local resources are, we must recognize 
that there are limits to how much we can charge for services. In my judgment, 
we have tapped that source adequately, and I see no significant new sources 
of revenue from increasing user fees in the near future. 

If the White House is successful in obtaining Congressional approval 
for the major portion of its budget cuts, we will lose substantial revenue 
from Federal sources. 

I intend to guard zealously our ability to meet next year's obligations. 
Specifically, I am announcing a policy that I will not sign supplemental 
requests for more spending, unless there is an obvious, extraordinary and over- 
whelming necessity. I have made this decision now, while the City is both 
fiscally sound and solvent, to protect our margins for the near future. We 
have to face the tough, looming realities. Our present margin — it is not 
appropriate to call it a surplus — is about $20-million. The Charter-mandated 
wage increases for City employees next year alone will cost us at least 
$60-million extra. We will need to work together diligently to assure that our 
City will be able to deliver quality local services and to live within our means. 

We will also have to work intensively on two related problems resulting 
from the boom in office construction downtown. If the proposed 24 million 
square feet of office space is developed downtown over the coming years, there 
will be these impacts: 


First, 96,000 new employees will be working downtown. 

Second, the City will need at least 21,000 new units of housing for 
the new employees who will choose to live in San Francisco. 

Third, there will be an estimated 21,600 new Muni riders during the 
peak hours. 

We must encourage office building developers to help meet the new 
demands for residential development. This year, our Planning Commission has 
indicated that developers of nine new high rise office buildings will need to 
provide 2,000 units of housing for employees who will live in San Francisco. 
Already, there have been commitments to construct or rehabilitate 600 units. 

To meet the increasing demands on Muni by the thousands of new workers 
downtown, I believe that we will need substantial new revenues to help finance 
the equipment and service Muni must add. This is obviously necessary to avoid 
massive congestion. I urge that the Board speed consideration of the special 
downtown assessment district. 

The whole Muni system and situation requires our detailed attention right 

Clearly, the state of the Muni diesel coach fleet requires immediate and 
urgent action. We face an emergency. Before focusing on that, I want to 
emphasize that Muni generally compares well with transit systems in cities 
throughout America. And improvements are being made. 

Systemwide, Muni can now carry 12.7% more people than it could a year 
ago, thanks to Metro completion and route changes. 


In general, Metro, trolleys and cable cars are significantly more 
reliable than they were a year ago. On the Metro and on trolly lines in the 
Northeast part of the City, bunching was reduced by 27%. All of the vehicles 
that are needed to meet scheduled trips are getting on the street, fewer are 
breaking down and more are at appointed stops when they are supposed to be. 

Due to improved management and organization, unscheduled operator overtime 
costs have been cut 36% in the past year for a saving of at least $500,000. 
There has been a 50% reduction in the hours of service lost because there was 
no operator to drive the ready vehicle. 

The one area where performance has fallen is diesel coach maintenance. 
I expressed concern to the Public Utilities Commission last month that this area 
has been weak and becoming worse all year. 

The bottom fell out in September. An average of 133 runs a day were 
missed during peak commute hours. Only 296 of the 429 diesel coaches required 
were getting out. And the situation has worsened in the past several days. 
This is what is being done about it: 

1 — All non-producing managers in the Diesel Coach Maintenance Division 
have been reassigned, with new personnel brought in. 

2-- If we can be sure of quick delivery at reasonable cost, at least 25 

and as many as 50 coaches will be leased from another transit agency. 

3--Beginning today, trolleys are being added to those lines that parallel 
or duplicate some of the most troubled diesel lines, such as Mission Street. 


4--The target date for new operation of trolleys on Sacramento Street 
has been advanced from Janaury 1 to December 1. That will free 25 coaches for 
other areas. 

The problem of catching up on the backlog of old buses that need engine 
and transmission overhauls and constant, quality brake work is being faced now. 
The new steps include an improved quality control program on brake work, a system 
of contracting out for quick and effective engine and transmission overhauls, 
and the expediting of existing contracts for overhaul work to return additional 
vehicles to the street within the next six to eight weeks. 

I will take on a personal oversight role in this whole effort to bring 
reliable service to the thousands of people who have been inconvenienced. And 
I will press for an orderly annual replacement program for worn-out vehicles 
to prevent this type of emergency in the future. 

We will have to face other problems big problems in the uncertain 

times ahead. But I am confident that our City has the strength and the talent 
to solve them. 

San Francisco can be proud of the progress being made this year in many 
of the services performed by the City. 

The Police Department is by necessity growing in size and its officers 
are working harder than ever before to make San Francisco a safer place for 
residents and visitors. 

There are 235 more officers now than at this time two years ago. The 
new faces in the ranks are products of one of the best police academies in the 


state. They are well-trained men and women who represent the diversity of our 
city. The Department is committed to hiring and promoting without regard to 
sex or ethnic background. There has not been one complaint of discrimination 
in hiring since the Department's Affirmative Action Plan went into effect last 
January 1. We expect that the Department will reach a full compliment of 1971 
officers by the end of this fiscal year. 

After several years of planning and engineering, the 9-1-1 Emergency 
Telephone System became operational on June 21. Citizens in need of emergency 
fire, police or medical assistance now have a direct, toll-free line into 
police communications. Trained operators are already handling 600 calls per 
day. Improved supervision and procedures have reduced busy signals and cut 
emergency response times by 2 minutes. 

More foot patrol beats are being covered, and the Mounted and Dog Units 
have been expanded. After an absence of over three years, Mounted Police are 
back in McLaren Park, using the stables as their base for patrolling the park 
and surrounding neighborhoods. 

The Department has made 13,500 more arrests so far this year than during 
the same period last year, an increase of more than 26%. 

The Department's newly reconstituted Community Relations Unit is closely 
involved with leaders and youth of the many neighborhoods of the City, working 
to reduce crime. Its Internal Affairs Bureau is revising its procedures to 
investigate citizen complaints of misconduct more rapidly, and the civilian 
Police Commission has constituted itself as a review board for disciplinary 


Total major crimes increased by less than one percent (0.8%) in the period 
from January 1 to October 11 this year compared with the same period last year. 
The increase for all other major California cities is about 3.5%. 

The Municipal Transit Division, organized last July 1, made 20 times 
more arrests this past summer than the civilian transit police made in the 
entire preceding year. The result is that crime is down on the Muni by 28.3% 
compared with last year. 

The Fire Department's quality continues to be one of our top priorities. 
Despite our tight budget, we succeeded in providing the necessary funding to 
maintain 315 firefighters daily on duty. Management has implemented organizational 
and procedural reforms to improve communications within the department. Perform- 
ance is routinely monitored through Management by Objectives. About 80% of 
fire calls are answered in 3 minutes or less. 

The Commercial Residential Inspection Safety Program was intensified and 
three special CRISP Task Force inspections were completed. More inspections 
were completed than in any of the three previous years and a correction rate of 
68% of violations found was achieved, far exceeding the goal of 50%. 

Through the continued efforts of the Arson Task Force, there was a 10% 
reduction in the number of arson fires compared with last year, and the arrest 
and conviction rate was more than three times the national average. False alarms 
were reduced by 5%. 

Providing adequate and affordable housing for San Franciscans remains a 
key objective of this administration. Our goal is 20,000 new housing units 


over the next ten years, and that requires imagination and creativity. As I 
noted earlier, the City Planning Commission has utilized its review powers 
and responsibilities to enlist the talents of office developers to build new 
housing to meet some of the demand generated by their projects. This 
unprecedented approach to housing production has encouraged developers to 
reexamine their programs. The Planning Department is now reviewing seven 
downtown mixed use office/residential projects that will include 1,000 housing 
units, similar to Fox Plaza. Four additional projects are likely to be proposed 

There have been many other advances toward our housing goals: 

A total of 1,666 units of new or substantially rehabilitated housing 
are in the planning process or under construction, through subsidies from 
the Department of Housing and Urban Development. 

Another 182 units of new mixed- income cooperatives have received commit- 
ments under the State Rental Construction program and should be ready in 1982. 

Community Development block grant funds have been used to allow nonprofit 
housing development corporations to acquire sites for 418 units of low and 
moderate income housing and acquire and rehabilitate another 310 units of 
existing housing. 

An additional 400 units of housing will be rehabilitated under the City's 
deferred payment rehabilitation loan program. 

The programs of our Redevelopment Agency are generating even more housing 
units. Next year, a total of 2,427 units will be constructed or rehabilitated 


through Redevelopment programs an increase of more than 200 units over this 

year's total. 

Right now more than $400-million worth of construction and rehabilitation 
is taking place in San Francisco's redevelopment areas — an all-time record. 

Work is continuing on the $40-million new Post Office facility in India 
Basin Industrial Park, in the $100-million George R. Moscone Convention Center 
and the $30-million Yerba Buena West building in the Yerba Buena Center, the 
$99-million Opera Plaza condominiums in the Western Addition, in the $100-million 
Embarcadero Center #4 office building, the $16-million Golden Gateway townhouses 
ahd the $8-million Chinatown housing for low-income families and senior citizens 
at Stockton and Sacramento Streets. 

More is on the horizon. The Agency has selected a world- renowned developer 
team for the $750-million Yerba Buena Gardens which, I am confident, will be 
created with quality, imagination and dignity. 

The City earlier this year approved a redevelopment plan to revitalize 
the Rincon Point and South Beach parks of our waterfront and to provide 
needed housing, open space, marina facilities and public access to the Bay. 

The Redevelopment Agency now has entered into exclusive negotiations and 
a land disposition agreement to get the long-stalled $100-million Fillmore 
Center off the ground. Construction is scheduled to begin next July. 

Reforestation of Golden Gate Park remains the top priority of the Recreation 
and Parks Department. The Department also opened a recreation center at 

St. Boniface's Church this year to serve vouth in the Tenderloin. 


The Recreation and Park Commission has continued to generate increased 
revenues. Total revenues in this past fiscal year (1980-1981) were $7,530,086, 
an increase of 13% over the previous fiscal year. 

Many neighborhood parks were successfully renovated in the past year, 
including Noe Courts, and children's areas at Excelsior, Moscone and Lincoln Parks. 
New recreation buildings were opened at Crocker Amazon and Rolph Playgrounds. 

Throughout San Francisco's government, improvement is apparent. But we 
know that we must do better. We have started new efforts against the ugly litter 
and graffiti which blemish the beautiful face of this City. We are moving to 
attract more ship repair business and to encourage more activity by the Navy here. 

And we are taking steps to boost the trade through our port steps which 

included a successful friendship mission by a dozen City leaders and me to Asia, 
from which we just returned. 

Clearly, we are making substantial progress on many fronts to preserve 
the strength and the good life of this noble City of San Francisco. 

Obviously, we have our work cut out for us to keep the state of the City 

I look forward to cooperating with the members of the Board of Supervisors 
to take on the tough tasks of this difficult decade. 

I look forward to listening to the voices and thoughts and yes — the 

grievances of individual San Franciscans, every day. 

I look forward, finally and with faith, to the future with all its 

puzzles and pitfalls and opportunities. 

Thank you. 

Office of the Mayor [i JT .*""* tit |] dianne Feinstein 

SAN MANCISCO x-mLSSam.'lf EB 1 9 1984 

x^T*->— gp^pn ... |C • IRRAPY 

2 p.m., Tuesday, October 12, 1982 


It is significant that each year we pause to consider the 
state of our city. 

I assure you that the San Francisco of today is in good 
health. Our City's economy is sound, our neighborhoods vigorous, 
our government solvent. 

It is also important to know we are not without problems, but 
that we are facing up to them effectively. 

Even more crucial, I believe, is a longer view. There is a 
need to assess the future of our economy, the long-term soundness 
of our government machinery, and our ability to anticipate 
tomorrow's difficulties while grappling with today's. 

The health of a person, or a city, relates as much to the 
days ahead as to the present. 

Before bringing you up to date on San Francisco's recent 
progress — and problems — let us look briefly down the road. 

My vision for San Francisco is a simple one, of people and 
practicalities. It is homes and jobs, transportation, businesses 
and conveniences. It is safe streets, clean streets, sunshine and 
greenery. It is parks and playgrounds and recreation. 

My vision is about San Francisco's lifeblood — children and 
families and the elderly sharing better lives. And it is a hope 
that the great mixture of mankind that is San Francisco can find a 
true and lasting community of interests. 

Economic vitality is the key to enrichment of life in San 
Francisco. We have that now, and must protect it. Just as the 
City competes effectively on a national level, it must compete with 
its suburbs. Our share of the Bay Area's rich economy must be 
maintained and enlarged. 

San Francisco must build upon its status as a headquarters 
city while maintaining the rich diversity of its broad business 
community. We must refuse to accept the loss of companies and jobs 
to suburban areas. San Francisco must continue to take all 
reasonable steps to strengthen business. We must continue to work 
with employers in retraining our workforce to meet their rapidly 
changing job needs. At the same time we must carefully monitor and 
control growth to prevent its encroachment on our neighborhoods and 
our bay, our views and the quality of our lives. 

Our future as the Gateway to the Pacific requires reaching 
out for trade, new markets and investments. Economic explosion is 
predicted around the Pacific Rim, and San Francisco is its natural 

As city leaders, we must responsibly maintain the 
government's financial strength through more and more prudent 
management. We are doing that today. And we have asked our Fiscal 
Advisory Committee to produce a revenue model that enables the City 
to see five years ahead financially in order to avoid surprise 

Now is the time to protect our fiscal future. 

Neighborhoods are the rich fabric of San Francisco, the core 
of our community. Neighborhoods are also people, and taxpayers — 
who deserve all the services the City can provide. 

New buses are on order to relieve overcrowding on the Muni 
Railway, and a five-year program of improvement and expansion is 

A large capital improvement program is being prepared to 
rejuvenate streets, sidewalks and neighborhood parks. Libraries 
are expanding and improving. 

Neighborhood re-zoning to enlarge residential areas and 
preserve a viable mix of commercial activity to serve residents are 
primary goals of Planning Department studies. If they are 
diligent, neighborhhod life will be enhanced. 

More police are on the City's streets today to make 
neighborhoods safe, and more are on the way. Police are working 
with citizens in self-protecting block groups. 

Importantly, City Hall is listening to neighborhood 
groups — and feeling the pulse of the community. 

City government is the machinery that will shape our 
municipal future. It is large and unwieldy, but has become more 
streamlined and more effective in recent years. 

San Francisco has moved rapidly into an era of government 
that is more tightly run, more responsive and more capable of 
assessing its own failings. 

With private sector help, City government has made long 
strides into modern management methods. Up-to-date fiscal 
procedures now protect taxpayer dollars and management-by- 
objective techniques require managers to set goals and meet them. 

City Hall computers are on line, promising improved public 
services. Employees are being re-trained in more modern systems. 


In short, a solid foundation is established for a municipal 
structure more capable of meeting the future's changing needs. 

Much remains to be done, but it will indeed be done. 

Let us now take a long, hard look at the many dimensions of 
Ran Francisco today. You are likely to be struck, as I was, with 
how frequently the City is the exception to national trends. 

We are witnessing economic decline, both public and private, 
across the country. Yet overall San Francisco's economy remains 
robust, continuing a pattern of vigor and growth. 

Nationally, retail sales are down and large stores have 
closed in some cities. Here, retail sales in the first six months 
of this year totalled $2.75 billion — up 5.4 percent over 
1981 — according to Security Pacific Bank. And another large 
specialty store, Neiman-Marcus , will open here soon just as Saks 
Fifth Avenue opened last year. Although some stores have reduced 
employees, both neighborhood shopping areas and the downtown retail 
district seem to be holding their own. 

Overall, tourism is down here 8 percent, and down nationally 
9 percent. Although that picture is expected to brighten in the 
remaining months, the decline causes concern. Businesses in the 
tourist industry are large employers of San Francisco residents, 
and I ask that all of us do what we can to see that San Francisco 
is aggressively promoted in a positive manner — both at home and 

Our convention business is increasing. Due largely to the 
first year of our great new Moscone Center, attendance has risen 
8.5 percent. 

The number of commercial and residential building permits is 
greatly reduced this year. But the dollar value of permits has 
more than doubled that of last year — rising to $1.01 billion from 
$548 million and making this the first time ever that San Francisco 
construction has exceeded one billion dollars. However, the great 
bulk of this construction is in large projects. 

In the neighborhoods, the construction and rehabilitation of 
homes and apartments is lagging. The number of residential permits 
has declined almost 50 percent this year, although their value 
climbed from $85 million to $109 million in the year ending in 
June, showing that our neighborhoods have been hit by the economic 
downturn. Home and condominium sales also remain static. 

The Redevelopment Agency reports an all time record: Nearly 
half a billion dollars in new construction in redevelopment areas 
of the City. 


Downtown continues to prosper. A record 6.8 million square 
feet of office development is now under construction. Five million 
more square feet have been approved and another 8 million are under 
review by the Planning Department. However, rents have reached 
their peak and are easing. 

The vacancy rate has increased this year from about zero to 
four percent — a substantial jump. This is a healthy develop- 
ment. San Francisco office rents are among the highest in the 
nation. A modest increase in vacancies may help bring rents down 
and make us more competitive with the suburbs — where vacancies are 
higher . 

San Francisco's growth as a headquarters city has been a 
phenomenon. However, the increase in office space available in the 
downtown area and the decision of some companies to locate certain 
of their operations in lower cost suburbs makes it clear we must 
not rest on our laurels, but remain competitive. 

The increase in major construction clearly places a burden of 
responsibility on City planners to insure that growth is orderly 
and controlled and will enhance the lives of San Franciscans. We 
do not take that burden lightly. 

Our Planning Department is preparing detailed proposals for 
re-zoning neighborhood commercial areas to help retain and restore 
the vitality of shopping areas. They are also working on downtown 
zoning, seeking to encourage future development into the South of 
Market to avoid robbing North of Market of sunshine and fresh air. 

The long overdue downtown environmental impact report is 
finally expected early in 1983, and will set the stage for the 
careful control of future growth. It is a high priority and the 
public procedures must move ahead so that the necessary changes can 
be enacted as soon as possible. 

The City's own finances have come a long way in this past 
year . 

In the State of the City message last year I pledged to 
protect our budgetary margin of safety — "to guard zealously our 
ability to meet next year's obligations." We have done just that, 
and have increased the fiscal safety margin. 

We now have a reserve of $152 million — of which $80 to $100 
million will be needed to balance next year's budget. 

I cannot help but recall the campaign rhetoric of the 1979 
Mayor's race in which a $120 million-plus deficit was predicted. 
Now, after three years of careful management, the City has a strong 
surplus and we have begun to upgrade services where necessary. 


We intend to send to your Honorable Board shortly a 
supplemental appropriation for $21 million to purchase 67 buses to 
relieve over-crowding on the Muni Railway — as soon as Proposition 
B passes in November. This top priority project will be the 
largest expansion of our Muni fleet in recent years — approximately 
14 percent. And we will soon propose the largest program ever to 
repair and rebuild the City's streets, parks and other parts of its 
physical plant. 

The Strategic Plan recently completed by business and govern- 
ment leaders concludes San Francisco should be spending $60 million 
more a year to maintain its physical plant. We support that view 
— for money spent on the City's infrastructure is an investment in 
the quality of life here, and in our future. Not to spend the 
money when we can would only haunt us later with greatly increased 

Long range, we have asked the Mayor's Fiscal Advisory 
Committee — those private sector leaders who do so much for our 
city — to prepare a five-year revenue plan. That should provide us 
with early warnings of any financial gaps in the City's future. 

The Assessor reports the value of real and personal property 
in the City increased this year to $23.4 billion. That is a rise 
of 15.5 percent, exceeding the statewide average of 11.8 percent. 
This strong value increase confirms the City's continued commercial 
dynamism, as new buildings are built and existing buildings attract 
new investors. It will generate $35 million more in property tax 

The Treasurer reports City investments earned $105 million — 
an amazing 45 percent increase. 

The Controller reports a successful audit was completed on 
time and without qualification. So greatly have operations 
improved that for the first time the Controller's Office will 
compete for the coveted Certificate of Conformance — the hallmark of 
government financial reporting. 

And the City proudly maintained the Standard and Poors and 
Moody's AA rating on bonds that were restored to us last year. 

One constant measure of a city's health and economy is 
employment — and of course, unemployment. 

San Francisco's labor force is growing. We have 110,000 more 
jobs here today than ten years ago — a 25 percent increase from 
455*000 jobs in 1972 to 565,000 now. 

In this fiscal year, we expect another 11,000 jobs. 

But these significant gains are clouded by the knowledge that 
26,000 San Franciscans remain without jobs. 





3 1 


Our projected unemployment rate for this year is 7.3 
percent — well below state and national levels, but still 
unacceptable. Because new jobs are being generated in our downtown 
areas, the rate is expected to drop to 7 percent in 1983. However, 
the seasonal rate jumped to 9.3 percent in August. This rate 
remains unadjusted and cannot be compared to national and state 
rates. But it sounds a warning bell. 

Sadly, when the economy most cries out for help, federal 
job-related dollars are being cut. Federal funds for San Francisco 
job programs have been slashed two-thirds — from $30 million last 
year to $° million next year. 

But we intend to take up the challenge. 

I have recently recons 
coordinate all City job trai 
pleased that Neil Harlan, th 
will lead this crucial effor 
our major corporate communit 
council has been instructed 
district, the community coll 
develop educational and trai 
needs. That is essential in 

tituted our Private Industry Council to 
ning and job creation, and am very 
e board chairman of Foremost-McKesson , 
t — and that high ranking officials of 
y will be working with him. The 
to work closely with the school 
ege and other learning institutions to 
ning programs targeted to employer 
our changing occupational picture. 

Seven out of ten new jobs created here will be in services 
and finance, insurance and real estate. And the so-called "new 
collar" jobs in computers and advanced technologies are increasing 
in both number and complexity. 

Learning institutions must concentrate on teaching skills 
that will lead to jobs. Our sizable minority population must be 
encouraged to benefit from this training as well as English 

City departments have already done much to help. 

The Office of Economic Development's program linking loans to 
employment of San Franciscans has resulted in 1,747 new jobs and 
retention of 995 in six major projects that will create a total of 
6,655 jobs. 

That agency's primary mission is to hold and expand the job 
base of our City. And it is working. 

San Francisco has led the state in issuing its first 
industrial development bond — for nearly $4 million — and more are on 
the way. This first issue was to help a small scientific 
instruments company to remain in San Francisco and expand its 
facilities in Hunters Point. 

The Small Business Administration approved the City's first 
low-interest debentures, along with 19 low-cost revolving fund 
loans for small businesses. Three Urban Development Action Grants 
have brought $8 million in federal loans for Ocean Beach Housing, 
Fillmore Center and North of Market housing. 

They mean jobs for San Franciscans. 

I firmly believe the move of Todd Shipyards into the Port of 
San Francisco will bring an increase in blue collar jobs. The 
Navy's award of its $18 million USS Roanoke overhaul contract to 
Todd of San Francisco will be the first of many such large jobs. 

Workfare is a concept much talked about — but in San 
Francisco it is taking people off welfare. Since last April, our 
Social Services Department has referred 2,200 employable welfare 
clients to jobs in our Department of Public Works. In a recent 
week, 333 welfare clients were working at prevailing wage rates. 
They had swept 158 miles of streets and cleaned 187,000 square feet 
of parks, plazas and landscaped areas. 

On the housing front, there are some encouraging strides to 
report, but we also have built-in problems to address. 

Recent census data shows a marked increase in the number of 
single persons in San Francisco, and a sharp decline in children. 
If we are to remain a city with families, we must redouble our 
efforts to provide family housing, and take other steps to keep our 
city attractive to them. 


Less than two thirds of those who work in San Francisco live 
in San Francisco. Of 565,000 jobs, 358,500 are held by residents. 
An important reason is the high price and very short supply of San 
Francisco homes and apartments. 

Despite rising costs, record interest rates and a 
construction slump around the country, San Francisco will record 
1,500 housing starts by the end of the year — nearly twice the level 
of toe past two years. In addition, 525 vacant units are being 
rehabilitated in the old Harkness Hosoital on the Panhandle and in 
the Herald Hotel in the Tenderloin. 

Much of this was made possible by the City's innovative 
Office Housing Production Program, which requires office space 
developers to provide housing for workers who live in San 
Francisco. Developers contributed $17 million for construction of 
Q00 housing units and the rehabilitation of 1,200. This has made 
possible the now-completed rehabilitation of 450 units of vacant 
and vandalized Public Housing and the conversion of the Pink Palace 
to senior housing, which is proceeding on schedule. 

A $60 million mortgage revenue bond has just been issued to 
finance 650 mortgages at incredibly low rate of 10.9 percent for 
homes on 22 sites around the city for 650 low and moderate income 
families. Included are the long-dormant Wisconsin Street site on 
Potrero Hill, the surplus Farragut School site in the Ingleside and 
Marshall Annex in the Mission. These bonds combine $5 million from 
three downtown office developers, with the bond moneys to fund 
shared-appreciation mortgages to reduce monthly payments. It is 
the first bond issue of this kind in the United States. 

More than 700 family housing units are now under construction 
here, including the 300-unit Northridge Cooperative in Hunters 
Point, and 2,500 low-income units are being rehabilitated. 

It is clear our housing needs are increasing. City planners 
are now evaluating re-zoning prospects that offer potential for 
improving the City's residential base. The South Beach area near 
the Bav Bridge, Rincon Hill and the Van Ness-South Van Ness 
corridor are prime candidates. 

I have covered the general state of the City as of today, but 
would like also to provide some highlights, achievements, and 
problems of several City departments. 

We have launched an ambitious, five-year plan to expand and 
improve our Muni Railway. On November 1 an outstanding transit 
operations expert, Harold Geissenheimer , takes over as General 
Manager. He has pledged to make the system the best in the nation, 
and has the credentials to do it. 


The Muni boards 264 million riders a year. It carries more 
passengers per vehicle than any other large system. That may be 
cost-effective, but it means the Muni is horrendously crowded and 
more often than not uncomfortable for passengers. We must correct 
the situation as soon as possible and will begin with a supple- 
mental budget request to your Honorable Board for $21 million to 
purchase 67 new Muni vehicles for the first major expansion of 
service in many years — as soon as Proposition B passes. 

Our beloved cable cars have stopped running for now, but in 
20 months they will return, after a $58 million rehabilitation that 
renews the entire system. 

We all owe great gratitude to the individuals and 

institutions who contributed and helped raise the $10 million to 

match the $48 million federal and state grants. This campaign is 
now but 5800,000 short of its goal. 

We have recovered fully from the diesel breakdown of last 
October and I now weekly review Muni maintenance figures to make 
certain that such a breakdown does not again plague us. 

Our perpetual parking problems reached a crisis point earlier 
this year. As a result, we revamped parking regulations. Top 
fines were cut in half, street sweeping citations modified, court 
processes speeded up and many public complaints put to rest. 

The Parking Authority this year has 1,657 more spaces on the 
way in six new neighborhood and downtown facilities. Five more 
projects are planned. 

In another kind of transportation, San Francisco Inter- 
national continued to improve its terminals as it handled 20.5 
million passengers. For the fourth straight year, it was named the 
nation's safest airport. 

At long last San Francisco has crime on the run. 

* Violent crime is down 10 percent and overall crime is 
down 6.1 percent. 

* The SFPD is reaching its full strength for the first 
time in the City's history — 1,971 officers. That is 
331 more than we had two years ago. It means more 
police and more arrests: 17,000 more than last year, 
for an increase of 22 percent. Also, 22 percent more 
cases have been solved. 


* People are banding together through Project SAFE in 
major crime prevention efforts — and they aire 
working — burglary is down by 30 percent in 
neighborhoods where SAFE is strongest , and 25 
percent citywide. 

* Crime on the Muni is causing great concern as more 
than 11,500 arrests are made and police efforts 
intensified. Our District Attorney must take these 
crimes seriously because our people certainly do. 

* After some mistakes, crowd control methods have been 
reviewed and techniques improved. 

* The average time of response has remained the same 
this year — 2 3/4 minutes. This is how long it takes 
for a caller to get a squad car and help when they 
report a crime in progress. We hope to reduce it 
further and move our cars and officers faster when 
the computer-assisted dispatch goes into effect 

* The Internal Affairs Bureau has been upgraded but 
further improvement in the quality and length of 
time for investigations is necessary. 

* Today, we have the highest minority participation in 
our department in history — 31 percent minority and 7 
percent women. 

I would like to congratulate and thank all 1,971 men and 
women in this department — beginning with its fine Chief, 
Cornelius Murphy. 

We have a new Fire Chief: Emmet Condon. He is up from the 
ranks, respected throughout the department and known nationally as 
an expert on high-rise fires. 

The department appears to be winning the war against its 
enemy number one: arson. Incendiary fires were reduced 17 percent 
to a low of 71. Fire fatalities were cut 25 percent, major alarms 
21 percent, building fires 12 percent and false alarms 9 percent. 

The City's firefighters maintained their three-minute 
response time, which held fires to the floor of origin 90 percent 
of the time. 

On October 1, the department began operating with its full 
manning schedule of 315 men on duty. This was made possible by 
settlement of its long-standing overtime suit with the Firemens 1 


In addition, the department hired an affirmative action 
coordinator — and its first female member, a fire safety inspector. 

I believe we are seeing the rebirth of the Port of San 
Francisco. For three straight years the Port has increase 
revenues, earnings and tonnage. This year, revenues are up 32 

The new Bethlehem-Todd Shipyard agreement, I firmly believe, 
will bring big-time ship repair and shipbuilding to our Port. As 
mentioned earlier, that will mean a resurgence of blue collar jobs. 

The key to big ship contracts is the U.S. Navy, and our Navy 
relationship is sailing smoothly along. Last year our first Fleet 
Week was a tremendous success in showing our hospitality to the 
Navy. This month, the second Fleet Week will be bigger and 
better — and it's all privately funded. 

I'm delighted that the ranking Navy man at last year's Fleet 
Week, Pacific Fleet Commander Admiral James Watkins, is the new 
Chief of Naval Operations. I visited him recently, and assure you 
he hasn't forgotten San Francisco's good treatment. 

In the last year our Port has attracted two new shipping 
lines, and another has returned to us. 

As a direct result of the City mission to China last fall, 
the China Ocean Shipping Company of the Peoples Republic selected 
San Francisco as its Bay Area base. COSCO began operations here in 

Scan Pacific, a Finnish flag operator, moved to San Francisco 
last fall. And this year Evergreen Line returned with its Far East 
service . 

In May, we officially opened our new passenger terminal at 
Pier 35. The next month, Holland American Cruises selected San 
Francisco as home port for its huge new luxury liner, the Niew 

Today our Port is capable of handling 25 percent of the Bay 
Area container cargoes. Healthy increases are projected, and the 
Port is planning to expand the San Francisco Container Terminal and 
Mission Rock to be ready for them. 

A decade ago, the state school superintendent branded San 
Francisco schools an embarrassment. Few disagreed. 'Today, the 
state is boasting about San Francisco schools, and so can we. 


Our students are making strides in improving their skills. 
This year, district students raised their verbal SAT scores by 14 
percent. More than half those who entered their senior year in 
high school tested at the college sophomore level. And scores in 
both reading and mathmatics have surpassed state predictions for 
urban school districts. 

Two programs have cut truancy. Attendance in elementary 
schools is 98.6 percent, in middle schools 97 percent and in high 
schools 94.9 percent. 

Enrollment is up 3,500 students this year. That is six 
percent, and highest of the 50 largest districts in the nation. 

We must all commend a vigorous and determined superintendent 
for this educational renaissance. Robert Alioto has returned to 
basics, to classroom discipline and to pride in our schools. 

Golden Gate Park is literally blooming this year with a 
record number of flowering plants. Next year there will be even 
more as the Recreation and Parks Department continues it planting 

The reforestation program that began two years ago is on 
schedule — assurring the park of rich tree life for generations to 
come. It is being implemented in all parks, citywide. 

This year saw a vast rejuvenation of neighborhood parks, with 
renovations in 69 projects throughout the city. Seventeen more 
renovations are in this year's budget. We intend to use available 
funds to continue this upgrading of neighborhood beauty spots. 

Work will start soon on a new* park in the Tenderloin. A 
mini-park named for slain Police Sergeant John Macaulay is nearing 
completion at Larkin and O'Farrell. 

Rack in Golden Gate Park, our historic Conservatory of 
Flowers is fully restored with a sparkling new lighting system. 
The Dutch Windmill has been rededicated through a public-private 
effort that was most successful. Other major park structures are 
being reconstructed. 

The Zoo continues to improve, and animal lovers are coming in 
greater numbers. The Gorilla World is widely acclaimed, the 
historic Lion House renovated and a great new Primate Center is 
under construction. 

The nation's leading turf expert, George Toma , declares the 
green grass of Candlestick Park the best in the country. 

In that context, we are waiting to hear whether San Francisco 
will be the site of the 1985 Super Bowl. Our chances are good. 


Openings of seven new library super-branches have begun. 
Along with the Main Library, they will be open seven days a week. 
The book collections have been doubled by $2 million extra in the 
Library budget. 

The City's Human Rights Commission points with pride to $50 
million in construction contracts that went to minorities and 
women. And the Intergroup Clearing House, the City's agency for 
prevention and control of civil disorders, was incorporated as a 
non-profit organization and received a funding commitment from the 
San Francisco Foundation. 

The Commission on the Status of Women reports much progress 
with its programs to reduce violence against women. It can now 
point to a ten percent reduction in rapes here. 

The Department of Social Services reports a decline in the 
refugee caseload for the first time. The trend could continue as 
the U.S. cuts immigration quotas almost in half. 

Despite increasing cuts in federal funds, the City is 
maintaining a full range of services for its senior citizens — 
including hot meals, housing, transportation, escort programs, 
health and home services and senior centers. 

We are now engaged in evaluating the possibility of a new 
downtown stadium. We have city and state owned land that could be 
ideal. A task force is at work and hopes to report next February 
on whether a new stadium can be financed without any additional 
burden beyond the present amortization costs of the Candlestick 
bonds. If the word is "go", we will submit for your consideration 
a Charter amendment to enable a vote of the people to make the 
final decision. 

We are also campaigning to bring the 1984 Democratic National 

Convention to San Francisco. We will know whether we are 

successful early in 1983, but the City has set" aside- $4. 5 million 
for it. 


We have tried with a good deal of success to upgrade key 
management in many of our City departments. This is a continuing 
process but today I take pride in telling you that we have a team 
that not only can deal with the crises of the moment, but is also 
building a more effective City government. 

A wise man has said we should all be concerned about the 
future, because we will all have to spend the rest of our lives 

San Francisco is concerned about its tomorrows, and is more 
ready for them than ever before. 

Thank you.